Unless someone in our household has had an accident and required car insurance, most of us rarely pay attention, policyholder’s death or not, to what happens behind the scenes. Here we take a look at what might, may or does, happen to the policyholder’s coverage after their demise or death, by discussing the processes and steps involved.
Understanding Car insurance Policies (Explanations of policies).
Car insurance policies are contracts between the policyholder and the insurance company; when a policyholder pays his or her premiums, he or she is buying protection against accident, theft, damage and so on. But what happens after death?
Immediate Action After Policyholder’s Death
There are certain things you should do right away that relate to your car insurance if your policyholder is deceased. Here’s what you should do:
1. Inform the insurance company: The first thing that should be done by the sole surviving life insured of the policy upon death. This is done either orally, in writing or in person to the insurance company, informing them of the demise of the insured.
2. Obtain Evidence: In order to provide evidence of a death, an insurance company will expect to see a death certificate (official documentation), as well as names and details of who will be taking over his/her affairs after death.
3.Payout review: After policy activation, the insurance company will give your policy a complete audit to identify the maximum payout and any beneficiaries.
What Happens to an Existing Policy?
Ongoing Cooperation Car policies typically stay active when their policyholders die, giving their estate time to settle, and any ownership transfers can take place at that time.
Grace Period: If the insured should pass away, some insurance companies provide an extra grace period in which the insured’s car will be covered under his current policy. Because these periods can differ between the insurer who provides this option and others, it’s best to call them each individually about this option.
Change of Ownership: Before transferring ownership to someone else or selling, new insurance policy from the insurance company is needed.
Cancelling Your Policy
As per the policy, when you wish to cancel the vehicle that no longer belongs to you or the one that you have transferred to someone, you can follow the steps mentioned below:
1. Contact Your Insurance Provider: Inform them of Your Intention To Cancel Policy
2. Consent to Send Copies of Required Documents: Your insurer might ask you to forward copies of supporting documents, including a death certificate and evidence that you no longer drive your car, for example.
3. Paybacks: If unused premiums apply, your insurance company may make a payback to your estate.
Handling Claims After Death of Policyholder
Existing Claims
If an open claim has been made against the deceased at the time of death, these cases typically could continue, subject to normal procedures, by an executor or estate representative on behalf of the decedent.
Filing New Claims
Estate trustees can still make claims with an insurer; their representative will walk them through this process with the paperwork that proves an incident occurred.
Executor Responsibilities
Executors have an important role to play regarding all the deceased’s car insurance. They’re usually required to:
Notify Insurer of Death: Note above, Executor of the Estate is in a legal bind to notify any surviving insurer of a policyholder’s death and report this information to insurer.
Claims Administration: We provide service for all existing claims and new claims.
Exercise of elemental policy decisions are when someone decides – for instance – to keep or cancel an insurance policy.
Special Considerations Multiple Vehicles
Dealing with an estate where the single policy covers many insured vehicles, each car must be individually dealt with by the executor and its insurance company as relevant.
Joint Policies
Where car insurance policies were held jointly between deceased and surviving spouse before death, this might continue with one as the primary policyholder – tell them to contact the insurer to update policy details.
After Losing Someone Dear to Car Insurance: Tips for Maintaining Policy after Death
In the hopes most of us never have to deal with this, but here are a few good practical ideas: A few strategies to follow when your car insurance policy needs to be transferred in the name of the personal representative of your loved one who recently passed:
Keep Your Records in Order: Keep records of death certificates, policy information and vehicle titles handy.
Get Professional Help: Consult with an insurance agent or a lawyer to determine the correct course.
Be Clear: Make sure you have clear communication with the company to make sure there are no holes in your coverage.
Conclusion
Dealing with the car insurance aspects of the passing of your policyholder is always a harrowing task, of course, but hopefully knowing what you are doing, where you fit into the overall picture as a customer, and what steps you must take – and who takes them on your behalf – will help your making sense out of a terrible situation and taking over from the next of kin.