Car Insurance Policy Endorsements: A Detailed Discussion

Posted on: Oct 19, 2022 | 3 mins | Written by: HDFC ERGO Team

Car Insurance Policy Endorsements: A Detailed Discussion

Endorsements in insurance plans imply the changes in details mentioned in the document of the policy concerned. In simple terms, endorsements imply slight modifications on the behest of both the insurer and the insured. Endorsements in car insurance policies mean making certain modifications and alterations to the policy document after it has been issued to ensure the ease of claim settlement.

The endorsement procedure is normally initiated by the insured. Depending on the business tactics of the concerned insurance company, they may negate the previous plan and issue the modified one, stating that the concerned plan has been endorsed.

In light of insurance technicalities, any insurance endorsement may be viewed as a mutual agreement between the insurer and the insured regarding the implementation of the necessary additions and alterations in a particular insurance plan.

How to make an endorsement?

To carry out any endorsement, you must first submit one request letter to the concerned insurance company, along with all the relevant supporting documents, clearly stating the need for modification(s). Once the insurance company verifies all the details and approves the endorsement request, they initiate the process on their end to implement the necessary alterations.

All the changes made get officially recorded by the insurance company on a special endorsement certificate, clearly stating all the alterations implemented. After completing all the official paperwork, the revised policy will soon be sent to your registered address.

Follow these simple yet crucial steps to endorse a car plan successfully:

● Step 1:

First, contact your concerned insurance company and ask them about the detailed process of endorsement that you need to follow to complete the process

● Step 2:

The concerned officials will provide the necessary link or ask you to send an email to their designated email address stating your request and the reason behind it.

● Step 3:

Submit all the relevant documents clearly supporting your necessity for opting for an endorsement. Make all the necessary clarifications from the insurance company in case of ambiguity.

● Step 4:

The concerned insurer will verify all the documents and your need for the request.

● Step 5:

If the application seems genuine in the eyes of the concerned company, they approve it and make the necessary alterations during the premium calculation as per the requirement and negate the previous policy

● Step 6:

The insurance company will issue a special endorsement certificate, clearly highlighting and stating all the amendments made to the plan.

● Step 7:

The policyholder will soon receive the revised policy within a short span on the registered address.

Car insurance endorsement validity

Once you make an endorsement, it becomes an indispensable part of your contract and remains valid throughout the policy tenure. If these changes remain unaltered, they will be automatically carried forward during renewal. Endorsements can be done once any plan is purchased and can be done throughout the policy tenure or before renewal. The validity of the concerned endorsements lasts till the expiration of the plan.

However, there are certain exceptions, depending on the company’s terms and conditions. Certain endorsements only remain valid for only a specified period. You need to be well acquainted with all the necessary terms and conditions of the concerned plan to avoid any misunderstandings.

How many times can you do car insurance endorsements?

Under normal circumstances, any standard insurance company encourages their policyholders to make necessary amendments as per requirement. There is no set limit to the number of times endorsements can be made during the policy span. On average, policyholders generally make at least one endorsement each year. However, multiple alterations are also made. The reasons behind making such alterations are varied, depending on the circumstances.

However, you must remember that making too many additions and alterations to the policy document might lead to confusion for both parties. This may impact the hassle-free claim settlement process.

Types of car insurance endorsements

Depending on the circumstances, the types of endorsements can range from the simplest to the most complicated ones. Such endorsements can be broadly classified into two types: premium-bearing endorsements and non-premium-bearing endorsements.

Pemium-bearing endorsements imply the ones where you need to pay for all the amendments you need to revise your insurance plan. Some of the common types of premium-bearing endorsements include:

● Endorsement due to transfer of ownership

● Endorsement due to rally participation

● Correction of the ex-showroom price of the concerned vehicle

● Extension of the previously stated geographical area

● Alterations made to the concerned vehicle’s mode of fuel, like, petrol/diesel to CNG

● Considerable alterations made to the concerned vehicle’s interior or exterior or both

● Changes made to the concerned vehicle’s Anti-theft device installation/reinstallation/modification

● Installation of any non-electrical accessories

● Installation of any electrical accessories

● Adding personal accident cover to the existing plan

● Removing Recognized Automobile Association Membership

Non-premium-bearing endorsements are that particular type of endorsement where you do not require to pay any additional charge for any additions or alterations made to the concerned policy document. Some of the basic types of non-premium-bearing endorsements include:

● Alterations to the policyholder’s name

● Alterations to the policyholder’s address

● Changes to the policyholder’s contact number

● Alterations made to the concerned policyholder’s vehicle’s engine number

● Alterations made to the policyholder’s chassis number

● Alterations made to the concerned vehicle’s registration number

● Changes made in the concerned vehicle’s policy plan coverage in the form of add-ons

● Any error occurred during premium calculation

● Any error occurred during the calculation of the No Claim Bonus

● Correction of the type of customer

● Alterations made in Lease Agreement, Hire Purchase Agreement, Hypothecation Agreement

● Changes made in the corporate name, prefix, customer name

● Change of nominee details

● Correcting the policyholder’s gender.

Conclusion

Car insurance endorsements are easy tasks and very essential at the same time. It simply needs you to submit the relevant supporting documents and complete the process on your end. There are even certain special types of endorsements that require either an increase or decrease of the amount of premium paid, depending on the nature of the alterations undergone. Therefore, we can well understand the necessity of endorsements for proper maintenance of car insurance, as and when needed. It is best to inform the concerned insurer regarding any changes that occurred on the insured vehicle impacting the policy plan and keep it updated to enjoy a hassle-free claim settlement procedure.

Disclaimer: The above information is for illustrative purpose only. For more details, please refer to policy wordings and prospectus before concluding the sales.

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