My auto policy was cancelled because the insurance company (Aviva) said they didn’t receive a form in time. They had asked for updated information and said to “return the completed and signed application” prior to a Monday deadline. Nothing had changed, but I still sent it out on the Thursday, four days before, by registered mail. We made our first claim last summer. Can they do this? – Mark, Toronto
Your insurance company can make you update your information any time, even if you haven’t moved or suddenly become an Uber driver.
And if you don’t get it to them by their deadline, they could send you packing.
“Policyholders have the responsibility to provide their insurer with updated information when requested,” Malon Edwards, spokesman for the Financial Services Commission of Ontario (FSCO), the province’s insurance regulator, said in an e-mail statement. “Failure to provide the requested information within the prescribed period may result in an insurer’s decision to not renew a policy.”
Typically, the requests come before your policy is set to be renewed, Edwards said.
There aren’t general rules for exactly how much notice they have to give – the specific policies for each company, and how they can cancel your policy, are set out in the underwriting rules it files with FSCO.
“During the year, our customers can get into accidents, incur traffic violations or have changes to the information used to calculate the amount they pay for insurance – we need to make sure we have all the correct and up-to-date information to renew their policy,” Fabrice de Dongo, spokesman for Aviva Canada, said in an e-mail. “In fact, every customer that fulfills the update request is renewed.”
Change in risk?
Even without a request, you have to tell your insurance company “promptly’ when there’s a “material change in risk” that could affect your rates – like a crash, speeding tickets, a change of address or change in the amount you drive. If you don’t, you’re violating your contract.
“… Not telling the truth, not paying your premiums, or not responding in a timely fashion would impact your relationship and coverage with an insurance company,” said John Bordignon, spokesman for Desjardins Insurance, in an e-mail.
So how quickly should you let them know?
“As a rule of thumb, in Ontario, you have to notify the [Ministry of Transportation] of an address change within six days, so you should yell you telling your insurance company by then,” said Anne Marie Thomas, senior manager of partner relationships for rate-comparison site Insurancehotline.com.
The rules vary by province. In the provinces with government-run insurance, you generally won’t lose coverage for, say, not updating your address or filling out a form too late.
Ulterior motive?
Sending out a bunch of requests for information – and knowing that people might not reply in time – can also be a way for insurance companies to get rid of clients who live in unprofitable areas, said insurance broker Adam Mitchell of Whitby, Ont.
“This is an exercise that a number of companies have gone through to lose business,” said Mitchell, president of Mitchell & Whale Insurance Brokers. “They can see where they’re going to be losing money going forward.”
When insurance companies aren’t meeting their targets, they “become even more harsh and less tolerant and give you less time,” Insurance Hotline’s Thomas said.
Is there anything you can do if you think they weren’t clear enough about the deadline? Complain.
“Each insurance company has an employee who works as a consumer complaint officer, and they are responsible for … ensuring that an individual’s complaint is addressed,” Edwards said.
Survey: one in four use phones on road
At least a quarter of Canadians still aren’t getting the message about interacting with smartphones while driving, according to a recent survey.
In an Insurance Hotline survey conducted last month, 26 per cent of respondents had used their phones while their car was in motion. And, 41 per cent said they are “likely or somewhat likely” to use phones at a red light.
“It’s all the things you do with a smartphone on a daily basis – unlocking it, texting, checking voice mail,” said Jacob Black, Insurance Hotline’s managing editor. “Canadians know it’s dangerous behaviour but they can’t divorce themselves from these devices.
When told that 310 Canadians were killed by distracted driving in 2016 alone, 44 per cent said they’d change their ways.
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