cancelling auto insurance

[onetwo_threefour]

Originally Posted by FlamesKickAss

Somewhat true. the company i work for will give you two weeks and then cancel. The don't charge you for time on risk, and like I said earlier in insurance silence is acceptance so if the company does charge for all time on risk you would have to pay that because you didnt notify them before that you were not renewing and the minimum retained premium is stated on the renewal offer as well.

I know you're in the biz and I'm a real estate lawyer, so we both have some idea what we're talking about. Although insurance companies would like to say 'silence is acceptance', you can be damn sure that if my house burned down a week after my policy expired and I hadn't paid the renewal, the insurer would certainly resist paying that claim. The point is very basic from contract law, the consumer's contract terminated through the expiry of the term, there is no obligation to renew at law, therefore any charge expressed as a 'cancellation charge' is clearly invalid. Really in this case we're not talking about 'silence' anyway, the insurer is trying to create a forced renewal in the absence of a written notice to terminate a contract that expires on it's own anyway.

By analogy, it's like signing a one-year lease, then being charged a cancellation fee by the landlord for moving out at the end of the year without warning. Even if the landlord offers to renew the lease, there's no obligation on the part of the tenant to say anything to the landlord, and the land lord can only charge rent if the person doesn't move out. If the person moves out the landlord has no claim against that person) I recognize that the insurance industry has different considerations regarding grey areas and continuing coverage, but my point was that it should be incumbent on the insurers to inform the customer of the required procedures to 'not renew' in advance, rather than being underhanded about it.

[FlamesKickAss]

true that is why when we sell a nordic policy as mentioned we are supposed to advise that it will auto renew and if they dont want to renew they have to advise nordic, prior to renewal date. Most agents don't though.

I'm in no way saying its right but that's the way it is, thankfully for me I rarely see it though because as of right now the company i work for (i'm a direct writer) doesnt charge for the ''time on risk"

But I have had some cases with nordic and its not fun to deal with

But yes if it happened before you paid the renewal, the insured would have to pay the claim, and it would be easier to do with some than others.

[ken0042]

Originally Posted by onetwo_threefour

From a legal standpoint, once the policy term is up, and the contract has expired there is no obligation on the part of the consumer to re-up with the same company and no validity to a cancellation charge.

Well, I know my company always sends me a renewal notice, and on it they state that unless they hear otherwise they will renew my policy. Which is exactly how I usually want them to handle it. I don't change insurance carriers very often, and I think I'm likely in the majority. I just want continuous coverage- they have direct debit from my chequing account so I don't even have to send them anything.

And that's the way most of my bills are. I don't have to call Enmax, Direct Energy, Telus, Shaw, Bell at the begining of the year to say "please continue service." But if I want to discontinue I do have to let them know. I think of insurance the same way- it is a monthly bill based on X dollars for the 2007 year, Y dollars for 2008, and Z dollars for 2009.