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Insurance lapse - want to stay with same insurer

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  • 23-09-2019 10:32am
    #1
    queenmeabh
    Registered Users Posts: 17 ✭


    Apologies if this has been covered - I can't find a similar thread.

    A family member's car was written off in an accident recently (my family member was not at fault) and they're in the process of looking for a new car to buy.
    However, their insurance is due for renewal very shortly and they might not have bought the new car by then.
    They would like to stay with the current insurer (for personal reasons) but are worried if there will be an impact if their insurance lapses (i.e. if they don't buy a replacement car before renewal date).

    Their broker is warning of dire consequences if there is a lapse - I wondered if anyone had experience of a lapse like this and how it played out? Ideally they wouldn't be under huge pressure to buy a new car very quickly.

    Many thanks.


Comments

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    #2
    Esel
    Registered Users Posts: 22,016 ✭✭✭✭Esel


    Ask about suspending the current policy.

    Not your ornery onager



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    #3
    Tazzimus
    Registered Users Posts: 3,935 ✭✭✭Tazzimus


    What reason did the broker give for "dire consequences"?
    Insurance companies lose customers all the time, hardly a precedent.


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    #4
    coylemj
    Registered Users Posts: 25,345 ✭✭✭✭coylemj


    OP, first of all that stuff about 'dire consequences' is rubbish, the broker must be desperate for the renewal. Your no-claims discount can survive up to two years without an active policy. When you renew or take out a new policy after a lapse, you will be asked why there was a break in cover and your 'family member' will have a plausible story which can be verified.

    If the individual has no car and is off the road, they should give back the cert and disc and ask for the policy to be suspended. That will stop the clock and save them money. However, if they have borrowed a car from someone and are relying on their own policy for cover then they obviously cannot do this.

    But note that in the 'driving other cars' clause of some policies, it states that your main car (the one named in your policy) must be roadworthy - this is to prevent people continuously renewing their policy for an old banger that's out of action while they drive a more powerful 'borrowed' car which is owned by them but registered to a relative or a co-operative neighbour.

    For example, Aviva have this condition under 'driving other cars', AIG and Axa have virtually the same wording. Liberty says your main car must be roadworthy....

    'You still own and insure your car under this policy and your car has not been damaged beyind economic repair'

    So if your relative is insured with any of those companies, they might as well suspend the policy because it will not will not cover them to drive any car. They can still borrow and drive a car which has 'open driving' which allows anyone (usually between 25 and 70) with a full licence to drive it.


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    #5
    coylemj
    Registered Users Posts: 25,345 ✭✭✭✭coylemj


    queenmeabh wrote: »
    However, their insurance is due for renewal very shortly and they might not have bought the new car by then.

    .....

    Their broker is warning of dire consequences if there is a lapse ....

    It just occurred to me that this day week (Sept. 30th) is the last day of the third quarter. The broker may be under pressure from the insurance company rep. to help him to make his quarterly target.

    Or the broker may be just shy of making a quarterly bonus from that company and your relative's renewal might just pull him over the line.

    Either way, there will be no 'dire consequences' if the policy lapses for a few weeks or even months. Not for your relative anyway, even if the broker loses his bonus. :rolleyes:


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    #6
    Eggs For Dinner
    Registered Users Posts: 2,941 ✭✭✭Eggs For Dinner


    Firstly, no broker would warn of ‘dire consequences’ if a policy is lapsed. Brokers gain and lose loads of policies every day. Perhaps they were being very professional and advising their client that the contract they were on has preferential conditions or acceptance terms which might not be available again should the policy lapse

    If you use a broker, trust their advice, otherwise go direct to an insurer or find another broker


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    #7
    queenmeabh
    Registered Users Posts: 17 ✭queenmeabh


    Thanks for the responses, all.


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    #8
    thebiglad
    Registered Users Posts: 1,566 ✭✭✭thebiglad


    The car which is subject matter of the insurance contract has been written off and has either been disposed of or at least is not insurable

    Technically the insurance policy should be cancelled unless the policy is changed to an alternative vehicle.

    If the current insurer takes no action and the policy reaches renewal date and lapses it is not the end of the world, not sure what broker is trying to say or why.

    You may however find when seeking a new quote following the lapse that the price may not be as favourable as a renewing customer (unlikely, shop around) or, with the claim open (until such time as the at fault driver's insurer reimburses your current insurer) there may be additional complications and loss of no claim bonus entitlement to contend with.


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    #9
    coylemj
    Registered Users Posts: 25,345 ✭✭✭✭coylemj


    thebiglad wrote: »
    The car which is subject matter of the insurance contract has been written off and has either been disposed of or at least is not insurable

    Technically the insurance policy should be cancelled unless the policy is changed to an alternative vehicle.

    Not every insurance company has this condition in their policy. Your car could be a write-off but you could still be covered to drive other cars. Unless your policy is with one of the companies I named in post #4 above.


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    #10
    Eggs For Dinner
    Registered Users Posts: 2,941 ✭✭✭Eggs For Dinner


    thebiglad is correct, the driving of other cars extension has nothing to do with the requirement that the subject vehicle being maintained as roadworthy. A written off vehicle does not meet that


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    #11
    coylemj
    Registered Users Posts: 25,345 ✭✭✭✭coylemj


    Eggs For Dinner wrote: »
    thebiglad is correct, the driving of other cars extension has nothing to do with the requirement that the subject vehicle being maintained as roadworthy. A written off vehicle does not meet that

    Which car are you referring to as the 'subject' vehicle. The car on your policy or the car you borrow?

    If you're insured with Axa, AIG, Aviva or Liberty and your car is writen off, your 'driving other cars' cover stops. So any car you borrow would need to have open driving.

    Is there a requirement that if your car is written off, you immediately cancel the policy? Because if you're not insured with the companies named above, you could technically borrow a car and drive it with cover under your own policy while you organise a new car.


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    #12
    thebiglad
    Registered Users Posts: 1,566 ✭✭✭thebiglad


    coylemj wrote: »
    Is there a requirement that if your car is written off, you immediately cancel the policy? Because if you're not insured with the companies named above, you could technically borrow a car and drive it with cover under your own policy while you organise a new car.

    It is for the insurance company to cancel the policy - you take out a policy of insurance for ABC 123 and this is now written off, paid by the insurer etc - what exactly is the policy for now?

    There is no private motor insurance policy for a person who does not own a car to purchase and drive under a driving other cars extension.

    Technically right now you do not own a car.


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    #13
    Eggs For Dinner
    Registered Users Posts: 2,941 ✭✭✭Eggs For Dinner


    coylemj wrote: »
    Which car are you referring to as the 'subject' vehicle. The car on your policy or the car you borrow?

    If you're insured with Axa, AIG, Aviva or Liberty and your car is writen off, your 'driving other cars' cover stops. So any car you borrow would need to have open driving.

    Is there a requirement that if your car is written off, you immediately cancel the policy? Because if you're not insured with the companies named above, you could technically borrow a car and drive it with cover under your own policy while you organise a new car.

    The 'subject' vehicle is the vehicle owned by you and declared to your insurers to be the basis of the policy. If this vehicle is written off, the policy is deemed to be determined. In other words, concluded and of no further effect. That is why insurers will ask you to return the certificate and disc for the vehicle in the event of a write-off and why the cancellation clause in the policy will state that no refund is due when the policy gets cancelled, where a claim has been made

    In all insurance policies, there will be a condition along the lines of requiring the vehicle to be maintained in a roadworthy condition. Obviously, a written off vehicle is not road worthy. This is a General Condition under the policy which means all aspects of your policy cover is dependant on it, including driving of other cars.

    In short, when your vehicle is written off, discuss options with your insurers as to what is the best thing to do with insuring a replacement vehicle


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    #14
    coylemj
    Registered Users Posts: 25,345 ✭✭✭✭coylemj


    thebiglad wrote: »
    It is for the insurance company to cancel the policy - you take out a policy of insurance for ABC 123 and this is now written off, paid by the insurer etc - what exactly is the policy for now?

    I'm talking about the period during which your car is off the road and you're waiting for the cheque.

    During this period and assuming that the car has been declared a write-off, some companies withdraw your 'driving other cars' cover, others do not. This is the point I'm making.
    thebiglad wrote: »
    There is no private motor insurance policy for a person who does not own a car to purchase and drive under a driving other cars extension.

    We really need to be told this?
    thebiglad wrote: »
    Technically right now you do not own a car.

    Regardless of what state the car is in, you own it until the cheque arrives.


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    #15
    galwaytt
    Registered Users Posts: 12,761 ✭✭✭✭galwaytt


    thebiglad wrote: »
    It is for the insurance company to cancel the policy - you take out a policy of insurance for ABC 123 and this is now written off, paid by the insurer etc - what exactly is the policy for now?

    There is no private motor insurance policy for a person who does not own a car to purchase and drive under a driving other cars extension.

    Technically right now you do not own a car.


    Until your claim is settled, you absolutely do own the car. If it's written off, and once your paid, it can go to the insurance company/recycler.

    Til then though, it's yours.

    Btdt, where our insurance co wanted to write off our car. The accident being the other persons fault (fully admitted), our 'advice' was to claim off our own policy and let the Co's sort it out: which meant writing off the car.

    We refused.

    We also did not proceed through our insurance co, went after the 3rd Party insurer directly, and made them repair it in full (which was nigh on the complete value of the car).

    For the entire duration we were and remained, the owners of the car.

    Ode To The Motorist

    “And my existence, while grotesque and incomprehensible to you, generates funds to the exchequer. You don't want to acknowledge that as truth because, deep down in places you don't talk about at the Green Party, you want me on that road, you need me on that road. We use words like freedom, enjoyment, sport and community. We use these words as the backbone of a life spent instilling those values in our families and loved ones. You use them as a punch line. I have neither the time nor the inclination to explain myself to a man who rises and sleeps under the tax revenue and the very freedom to spend it that I provide, and then questions the manner in which I provide it. I would rather you just said "thank you" and went on your way. Otherwise I suggest you pick up a bus pass and get the ********* ********* off the road” 



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    #16
    Eggs For Dinner
    Registered Users Posts: 2,941 ✭✭✭Eggs For Dinner


    Of course you remained the owners of your car, but it was not maintained in a roadworthy condition until it was repaired. There would be no problem with this if repairs were proceeding at a reasonable pace, but you cannot maintain a pile of twisted metal indefinitely to keep your policy live, and avail of other benefits of your cover.


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