Explain it like I'm five
We're making insurance so simple, now even 5-year-olds can understand it.
Rohan's dad is getting transferred to another city and the entire family is shifting. Rohan is sad because he thinks his cricket classes will stop. But his mother cheers him up saying that his cricket association has a branch in the new city as well! They can show his membership form and Rohan can continue his classes there too!
Same is with your car insurance. Changing your city doesn't mean you have to give up on your existing car insurance policy!
Still pondering about the point above? Yes, you heard it right? Your car insurance policy is valid across the country even during the transit period and will not be invalid even if you change cities.
But, it is always advisable to inform your insurer about the change and update your policy documents. Why you ask? Because, it is wise to cover all your bases.
If any communication or renewal notification needs to be shipped to you, your updated address helps to speed up the process! Although, we believe and follow a zero hardcopy philosophy, yet at times when you require a physical document, we can only ensure that it has reached you if we have a valid address!
Moral of the story? It is always wise to keep your insurer in the loop!
However, change of address can affect the premium that you pay on your car insurance policy.
How does this work?
When you buy car insurance, your premium is calculated on the basis of a number of factors – such as the age of your car, its fuel type, its IDV (Insured Declared Value) or market value, and so on. One of the most important factors in this list is your location – the city or RTO (Regional Transport Office) in which your car is registered.
Certain criteria of your car, such as its engine size, contribute to different premiums, depending on the area or pincode that you live in. Some cities have a higher risk of accidents and car theft, have higher population density, heavier traffic and/or higher vehicle density than other cities.
How does this affect your car insurance premium?
If your car is registered under a city that is low-risk prone but you are moving to one that is high-risk prone, you may have to pay a higher insurance premium. So, it’s safe to say that if you are moving from Bareilly to Bangalore, your premium is bound to change at the time of renewal. (Do note that your policy is valid till its expiry date, irrespective of a change in zones midway.)
Alternately, the premium can also decrease if you move cities. For instance, when a car owner moved from Bangalore to Sholapur, his insurance was still valid, but his premium on renewal decreased as Sholapur was classified as a lower-risk city than Bangalore. He was delighted when he was refunded the difference amount.
But what happens when you shift cities with similar risk, midway through your policy, and you have to make a claim? For example, your insurance is registered to your address in Mumbai, but you take your car to Kolkata where it meets with an accident (we hope that never happens).
Don’t fret, you can claim insurance even when the mishap has occurred in a city different than your registered address. Here both the cities have similar risk appetite and hence, your policy dosen't attract too much of a difference.
So, now that we know how changing your residence can affect our premium, let’s see the process to get it changed in your policy:
The process of recording your change of address with your insurance provider is simple.
- Get your address changed in your Registration Certificate
- Inform your insurer about your change of residence
- Submit a written communication with a proof of your changed address and your updated Registration Certificate
- Get an endorsement or updated policy with your changed address from your insurer. (An endorsement is an amendment or addition to an existing insurance contract which changes the terms or scope of the original policy. It acknowledges that you have moved cities and paid a premium difference - if that’s the case.)
Just make sure your registration certificate has the change of your residence recorded, as it will be required, to provide you with the endorsement.
Unsure whether a shift in residence will adversely affect your premium? Get in touch with your insurance company, regardless.
Rest assured that your insurance company has your back, no matter where you go. ☺️