My address has changed. Does my car insurance company need to know this?
My address has changed. Does my car insurance company need to know this?
We are halfway into the year 2021.
And just when we thought the ordeal is over, we were struck by another wave of the dreaded pandemic. The restricted movement order by the Government has led many city-dwellers to shift back to their hometowns for an indefinite period. But do you know that you must inform your car insurance company when you make a move? Well, you might argue and forego informing them since the car insurance policy remains valid throughout the country. But did you know that location can impact your premium? Yes. You read that right.
Thus, it is advisable to inform your car insurance company about the change to update your policy documents. Now you may ask why? Because better safe than sorry!
Now, let us discuss the how’s and why’s!
Does the change of residence affect the policy premium?
Simple answer to this is yes!
At the time of car insurance policy purchase, your premium is calculated based on certain factors like age of the car, engine type, Insured Declared Value (IDV), and many more. One of the determining factors for your premium is the location or the RTO (Regional Transport Office) where your car is registered. Depending upon the pin code or the area where you live contribute to varying premiums for vehicles of varying segments. This is because certain cities have a higher risk of car thefts or road rage or are more prone to natural disasters, or have higher vehicle density than other cities.
How does the change of address impact the policy premium?
Let us explain this with an illustration. You purchased and registered your car in a semi-urban city that is low-risk prone. Now, you are moving to an urban city prone to high-risk incidents such as road rage, natural disasters, fires, etc. From the insurance company point of view, the chances of a claim request would be higher in the city, which means you would have to pay a higher insurance premium. In short, if you shift your residence from Dehradun to Delhi at the time of renewal, your premium is bound to go high.
Similarly, in some cities, the risk of car theft is higher. If you move to a city where natural disasters like floods, landslides, or cyclones are common occurrences, the insurer would have to consider them as well.
Now, this is something that you should know. The change of cities does not mean that there will necessarily be a spike in the premium. If you are relocating to a safer city, then the insurer will lower the premium price. Or, if you are shifting cities with similar risk probability, there won’t be much of a difference.
But, nevertheless, you must inform the insurer. Visit the online car insurance portal of your insurer to change your address or learn about the process.
How can the address be changed on the insurance policy?
- Inform the RTO and update your current address in your Registration Certificate (RC)
- Inform your insurance company about the change of address
- Submit the proof of your changed address as well as updated RC
- >Get the updated policy or endorsement which will reflect changes in place of residence, terms, scope and coverage of the policy, and policy premium
Why is it important to inform your insurance company about the change?
Informing the insurer is essential so that you do not miss out on any communication sent by the insurance company to the address originally registered. This is required as the communications related to your car insurance renewal may not reach you at your current location and continue getting delivered to your earlier address.
Conclusion
When you change the city, you need to make several adjustments. Likewise, your insurance for car renewal or the policy itself has to be adjusted according to where you are driving your car. To ensure that you have all bases covered, you need to inform the insurer about the address change at the earliest so that there are no obstacles in the approval of the claim requests.
Disclaimer: The above information is for illustrative purposes only. For more details, please refer to policy wordings and prospectus before concluding the sales.
This blog has been written by:
S. Gopalakrishnan | Motor Insurance Expert | 40+ years of experience in insurance industry
A veteran in insurance industry, S. Gopalakrishnan is a name to reckon with in the field of reinsurance; he has headed the Reinsurance department and has rich experience in other fields of motor insurance. He loves to share his opinion on the latest topics in the insurance industry and how he can help people in safeguarding their assets using insurance products.
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