Let’s put it out there right up front. Every time you move home, or jobs, or buy a new car, you need to update your insurance policy. Seriously, this is a thing. In all the excitement, stress, and chaos of whatever new thing has happened, people often forget to tell their insurers about it. At least… They forget about it until it’s time to claim.
And then all the sadness happens, because it’s highly likely that your claim for your stolen car or home burglary that resulted in no more TV, fridge, and computers will be rejected. But why? Why is it so important that your insurer know so much about your life? Why does not telling your insurer have such a disastrous effect on your claim?
Why your insurer needs to know
Basically, your insurer uses a variety of details about you and the item you’re insuring to do 2 things. The first thing is creating a policy that’s just for you. The second thing is calculating an accurate premium for you to pay each month. These are kind of important things to get right and if your insurer doesn’t have the right info, then your cover and premium will be wrong.
Take a second to think about it. If you want insurance for your car, the insurance company will need to know all sorts of details, like where it’s usually parked during the day and where it’s usually parked during the night. This way they can create an accurate policy and premium for you. So you’ll need to tell them if these addresses change.
Time for a story
Meet Bob. He’s from Cape Town and has, among many other possessions we’re sure, a Ford Figo which he has insured. Good for Bob. Around a year or so after he insured his car, he got a promotion and could finally afford to move into a bigger flat, a few streets away from the office. The move was a bit hectic but he managed, and he settled into his new dwelling and responsibilities just fine. But he forgot to tell his insurance company about the change in address. And that was bad for Bob, because his car was stolen from outside his new flat and his insurer didn’t know that Bob had moved…
Seeing as Bob’s old address was still noted on his policy, his cover was incorrect and the premium he’d been paying was wrong, too. Unfortunately, his claim for the stolen car was rejected.
What your insurer will do
Let’s say that 1 of the details that has been recorded on your policy isn’t up to date, like your address. This will mean that your policy is incorrect when you want to claim. Depending on the type of claim and the detail that hasn’t been updated, your claim could very well be rejected. Imagine claiming for a burglary at your new house and your insurance is still covering your old address.
In this case, claims are usually rejected on the basis on non-disclosure. This isn’t the worst thing that could happen, though. Your whole policy could be cancelled, which doesn’t bode well with you if you ever want to get insurance again, because most (if not all) insurers will ask if you’ve ever had a policy cancelled for any reason. They get a bit iffy around this type of event.
When your insurer needs to know
Immediately. Think we’re joking? We’re not. You should tell your insurer as soon as anything changes and not a moment later. You can’t predict when something will happen to make you claim, so you really can’t afford to delay telling your insurer about moving house or buying a new laptop.
Just like a fine wine, your life will improve and you’ll accumulate more and better things. Your insurance policies should similarly ‘improve’ over time, which means calling your insurer up to close the gaps in your cover so that you’ll be financially protected in the event of theft, accidents, or other nasties. Considering that it’s almost the end of the year, we suggest that you take a few minutes to update your policies in January, particularly after you’ve treated yourself to a few goodies during the December break.