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  • Complete Guide on Endorsement Policies For Car Insurance

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    As per the Motor Vehicles Act in India, it is mandatory for every vehicle owner to insure his or her vehicle with at least a third-party liability cover. Car insurance is usually of two kinds, comprehensive car insurance policy that covers own damage liabilities as well as third-party liabilities and third-party liability car insurance plan that covers third-party liabilities alone at the time of a mishap. Car insurance protects the policyholder/owner of the vehicle against unforeseen liabilities that arise as a result of unfortunate mishap that could or could not be the mistake of the policyholder. Due to the vitality of the motor insurance policy, it is important that the policyholder declares or provides accurate and true information to the insurer at the time of policy issuance. This helps the insurer determine your insurance premium for the coverage opted and the policyholder can reap maximum benefits from the package without any issues. In case the policyholder has given incorrect information or due to any other reason wish to make changes to the existing information in your car insurance policy, you can do this through an endorsement. You will have to request the insurer to have your car insurance policy endorsed. It is absolutely necessary that your insurance policy stays up-to-date at all times. In case the insurer finds out that the information provided by you is incorrect, your car insurance policy can be terminated and your claim raised at the time will be denied.

    What is an Endorsement?

    An endorsement in car insurance policy refers to the changes/alterations you wish to make or have made to your insurance policy. In case you wish to make any changes or alterations to your insurance policy document, you can do so by informing your insurer about getting your policy get endorsed. After the endorsement has been done, the changes you asked for will be incorporated in your insurance policy by the insurer. The changes will not reflect in your original policy document, but an extended letter with all the changes made to the policy will be issued by the insurer. Endorsement can be anything from change in vehicle details to change in personal details.

    How often can an endorsement be requested for?

    Insurers motivate the policyholders to make the changes to their insurance policy as and when required. There is no set limit to the number of times the endorsements can be made to a motor insurance policy during the time policy tenure. The policyholder can endorse his/her insurance policy at least once a year. A large segment of the population make multiple endorsements to their insurance policy every year. The reason to endorse can be any, such as failure to provide accurate information at the time of policy issuance, change in the address/phone number of the policyholder, change of the vehicle, etc. Though doing endorsement is necessary, doing it often may lead to mistakes/errors in the insurance policy document, leading to claim denial and other confusions.

    Different Types of Endorsements

    Endorsements are usually of different kinds, premium bearing endorsement and non-premium bearing endorsement.

    • Premium Bearing Endorsement

    Premium bearing endorsement is a type of endorsement where you have to pay for the changes or alterations that you make to your insurance policy document. Following are a few of the premium bearing endorsements that insurers follow in India:

    • Endorsement of Ownership Transfer
    • Endorsement for Rally Participation
    • Correction of Vehicle Ex-showroom Price
    • Extension of Geographical Area
    • Addition of LPG/CNG Kit
    • Installation of Non-Electrical Accessories
    • Addition of Personal Accident Cover
    • Installation of Electrical Accessories
    • Removal of Anti-Theft Device
    • Removal of Recognized Automobile Association Membership
    • Non-Premium Bearing Endorsement

    A non-premium bearing endorsement is a type of endorsement where you do not have to pay for the changes or alterations that you make to your insurance policy document. Following are a few of the non-premium bearing endorsements that insurers follow in India:

    • Correction of Registration Number
    • Change in Contact Details, Mobile Number
    • Correction in Customer Type
    • Changes in Hire Purchase Agreement, Lease Agreement, Hypothecation Agreement
    • Correction in Prefix, Customer Name/Corporate Name
    • Correction in Nominee Details
    • Correction in Gender, Customer’s Address, City

    Making An Endorsement

    The process of having the insurance policy endorsed is hassle-free and easy. The policyholder will have to submit an endorsement letter to the insurer requesting the insurer to make the changes/alterations to the insurance policy. The policyholder will have to list the changes/alterations to be made to the policy in the endorsement letter. You will also have to provide the supporting documents to the insurer along with the endorsement letter. The insurer will verify if the changes to be made are accurate and make the changes/alterations to the policy document.

    Impact of An Endorsement

    Depending on the type of endorsement, premium bearing endorsement or non-premium bearing endorsement, you might get a discount on your insurance premium or will have to pay extra premium for your insurance.