General insurance Policy Renewal Procedure

[Mataracy]

Most non- life insurance last for only a year. When the year is over the contract expires and insurance cover ceases. But the insured may want to continue his cover with the same insurer for another year. The insurer, too may be willing to enter into another similar contract, provided that the risk has not altered drastically and that the previous claims experience has not been excessive. Under these circumstances there is obviously no need to repeat the whole purchase procedure (offer and acceptance). All that is necessary is to agree to renew the expired contract for another year. Long term contracts, such as life insurance and permanent health insurance last for many years, however the insurer is obliged to continue last for the entire period. So no annual renewal of that contract is necessary. When a long-term contract expires the insured may of course wish to enter in to another one. But he must then repeat the the whole purchasing procedure because he has grown, older, and the risk has been altered.
When a short-term contract is renewed for another year, a legally separate contract is created. Offer, acceptance and all the other requirements for the information of an insurance contract must be present again. In particular, the insured must disclose any material fact which have developed or altered since the previous year.

 

[Mika]

When you are buying an insurance policy, you will have to fill many pages of the form, produce documents, etc. However, renewal is very easy, all you have to do pay the premium. In my home country, I can directly pay my premium directly from my bank account, through online banking, or pay via mobile wallet.