In case two motor fleet insurance policies are in existence for the same vehicles with the same covers. Cancel one of the motor fleet insurance policy.
Read More: How to file a claim under Motor Fleet Insurance Policy?
In situations where one of the motor fleet insurance policies starts at a date later than the other insurance policy, you need to cancel the policy that you bought later.
Here, it is important to understand that if a vehicle is at any time insured with two different offices of the same motor fleet insurance company. A policyholder may be allowed to get a 100% refund of the premium by canceling the motor fleet insurance policy which he/she buys later. However, if two different insurers issue motor fleet insurance policies, the policyholder must cancel the one that commences later. The company will refund the premium on a pro-rata basis.
In those situations, where it is required by the motor fleet insurance policyholder to cancel the earlier dated policy, then the insurer will deduct the premium for that amount for which coverage was given, i.e., for the period for which the insurance policy was active before the cancellation. Retain the minimum premium as specified in the tariff in all situations.
However, if a claim has been made on either of the policies during the period when both motor fleet insurance policies were active but before canceling any of them, the company will not issue a premium refund for such cancellation.
Remember, the purpose of an insurance policy is to offer you financial security against various losses or damages, however, in any case, you won’t get more than what your actual loss is even if you have bought two motor fleet insurance policies.
Case: 1
R.J Mill has a wide array of cars that the company uses for providing transportation facilities to its employees. As the company has to buy motor fleet insurance also, it purchases the insurance from two different offices of the same motor fleet insurance company. As the vehicles run in both Delhi and Pune, the company buys motor fleet insurance policies from both offices of the same insurance company.
However, it is necessary for R.J Mill to cancel its one-motor fleet insurance policy. In May, the policyholder bought the first insurance policy, and in July, they purchased the second one.
R.J Mill should cancel the second policy by informing the same to the insurer in writing. In this case, the insurer can refund 100% of the premium paid by R.S Mill.
Case: 2
L.S Jewellers has offices spread across the country. Last year, the company purchased 50 new cars that it planned to use for both its personal and official work.
As it is essential to buy a motor fleet insurance policy. L.S Jewellers bought two motor fleet insurance policies of the same coverage from two different insurance companies.
Read More: What is not included in your Motor Fleet Insurance Policy?
However, L.S Jewellers has to cancel one motor fleet insurance policy. The company should cancel the policy that the insurer buys later. The company would refund the premium on a proportionate basis.
Case: 3
Recently, N.K Engineering has purchased ten more vehicles for the transportation of employees and goods. The company has decided to buy motor fleet insurance from two insurance companies. However, it should avoid doing so.
In case, it has already bought the policies from two different insurance companies. It is necessary to cancel that policy which it purchases later. The insurer will refund the premium on a proportionate basis.
If N.K Engineering files a claim on either of the policies before canceling the insurance policy, the motor fleet insurance company will not issue a refund.
About The Author
Shivani
MBA Insurance and Risk
She has a passion for property insurance and a wealth of experience in the field, Shivani has been a valuable contributor to SecureNow for the past six years. As a seasoned writer, they specialize in crafting insightful articles and engaging blogs that educate and inform readers about the intricacies of property insurance. She brings a unique blend of expertise and practical knowledge to their writing, drawing from her extensive background in the insurance industry. Having worked in various capacities within the sector, she deeply understands the challenges and opportunities facing property owners and insurers alike.
