Why should you read your Insurance policy renewal when it comes in the mail?
You originally talked to your broker when you purchased the policy and you are sure you covered everything at that point. It was enough to satisfy your needs, so you signed the application, it was approved and you went on your way.
Auto insurance in Dubai can change the limits of coverage, offer additional coverage, decrease coverage or can put a cap on different areas. It is done in writing, but you have to read your policy, or you would never know. It is your broker’s job to confirm these types of changes to you as these changes must be communicated to you.
A perfect example of this happened years ago when only the owner of the policy needed to be shown as the driver of the vehicle. Ten, twenty years later, Insurance Companies started basing their rates partly on the drivers experience with continual proof of insurance with no lapse of coverage. This was a huge problem. Originally, their spouse’s name and driver’s license numbers were never needed or even asked for when the policy was issued.
Now there are discounts and lower rates offered to a policy holder where all drivers have proof of a clean record and show at least 6 years of continual licensing and proof of insurance. Now we have an operator who may have been driving on their spouse’s policy for years, but there is no proof of them driving or having been insured because it was never required.
By law, any change to a legal contract must be given in writing to the other party involved. Notice of such change should be given in a timely matter, in insurance it is usually 30 days. There is also a term “grandfathered” which means that if your contract was put in force prior to a specific date, your terms would remain the same as the day you originally signed the contract. While some do offer that type of benefit, some will just give you a year to conform to the new rules.
Another example of changing a contract, happened years ago was allowing all drivers, new or present, insurance with no surcharge for any type of traffic infraction. It was a marketing nightmare when all the drivers with 6 or 7 tickets, flocked to the Company and were not penalized for their driving habits. They did increase the Company policy count, but it also increased their annual loss ratio.
Recently the Insurance Companies have come out with “Accident Protection”. This is an endorsement which waives any additional premium, should you have an at fault accident.
What many people do not realize, it is only good with the Company it is issued. If you do a comparison quote with other companies on renewal, a different company will offer a rate to you, but it is going to charge for the accident. Bottom line, you will have to stay at that particular insurance company until the accident is off your record.
This is little different than the insurance companies changing the original contract. This sort of change is usually done on renewal. Auto Insurance premiums are regulated with the rules they must abide by each year. If and when there are changes, they are obligated to advise their clients of any change. This is the importance of reading your policy every year for any changes made or offered to you.