It is illegal to drive on Indian roads without a valid car insurance policy for the vehicle being driven. There are many of us who are not aware of this law and end up paying hefty fines when we are stopped by the police. Another fact that we may be unaware of is that sometimes an insurance policy may not have the right information about your vehicle and this may cause disputes when making a claim. Certain facts like manufacturing date of the car or the cubic capacity of the vehicle all contribute a lot to the premium that you need to pay as well as the claim that needs to be made.
What is an Endorsement?
And endorsement for insurance refers to a change in an insurance policy made by the insurer on the behest of the policyholder. It acts like a tailpiece to your already existing policy. When an endorsement is made, the policy will incorporate the changes that have been asked for. Any kind of change to a policy is called an endorsement. These changes can include coverage changes, vehicle changes, loss payee changes, driver changes, and a whole array of miscellaneous changes.
How often can an endorsement be requested for?
Car Insurance agencies expect people to make changes to their policies as their needs change in time. To meet this expectation, endorsements were created and offered. On an average, a policy will be endorsed at least once in a year. There are a lot of people who make multiple changes to their car insurance policy every year. There are also people who make requests for the addition or removal of coverage on the same vehicle and this happens several times in a month. This should be avoided as frequent changes to a policy can lead to mistakes being made and these mistakes can cost you a lot of money.
Different types of endorsements:
A change in your car insurance policy is made due to a number of different reasons and scenarios. Some of these endorsements for specific scenarios are mentioned below:
- A correction/change in the engine number
- A correction/change in the registration number
- A correction/change in your address
- A correction/change in the chassis number
- A correction/change in your name
- A correction/change in your email id and/or your mobile number
- Increasing or including the voluntary deductible
- A correction/change in your car’s variant
- A correction/change in the model and make of the car
- Any premium mismatch
- A correction/change in your vehicle’s fuel type
- A correction/change in the Insured Declared Value (IDV) of your vehicle
- Any type of addition or deletion of electrical accessories
- An inclusion of a LPG/CNG Kit
- A correction/change in the seating capacity of your vehicle or passengers covered
- A correction/change in your car’s cubic capacity
- Any correction that was made in the No Claim Bonus
- Change in relation to the details of the nominee
- A correction/change in the vehicle’s year of manufacturing
- A transfer of ownership of the vehicle
- Any addition or deletion of zero debt
The changes listed above can call for a change in your car insurance policy in the form of endorsements.
Making an endorsement:
Making an endorsement is a simple task and can be done easily by a policyholder. All that the policyholder will have to do is provide a letter requesting the insurer to make the necessary changes that you require. The insurance agency will then make the necessary changes after checking the accuracy of the changes that have been requested for.
Implications of an endorsement:
With endorsements being an easy task that requires only the completion and submission of the documents that are asked for which would generally include the request letter and proof of the changes that have been requested for. There are some endorsements that would require an increase or decrease of the premium paid. For example, if the make of the vehicle has undergone an upgrade or if the cubic capacity of the car changes, the premium that is paid will also increase. You will then have to pay an extra amount as premium.
In summary, we can conclude that it is very important to maintain your car insurance by endorsing the same whenever needed. If there are any changes in the details of your vehicle, you have to inform your insurer as soon as possible as this can seriously affect your claim when the need arises. Therefore, be on the safer side and ensure that you policy is kept up-to-date.
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GST Update: GST of 18% is applicable on car insurance effective from the 1st of July, 2017