While it’s good to get insurance coverage for your business, it is also prudent to stay on good terms with your insurance company. One of the ways to do this is by making sure that you renew your policy on time. Letting your renewals go past the due date will have negative impacts on you and your business.
Termination of the Policy
Every insurance company allows for a grace period. The company sets the deadline date within which the renewal of the insurance coverage should be done. The grace period is the additional time that your insurance company gives you if you still have not renewed your policy. In most cases, the period is 30 days. After this period, the insurance company has the right to terminate your policy. When your policy is terminated, it means that you cannot be compensated for losses, even if the cause of the loss is one of the risks you were insured against.
You could see your premium increase by a significant amount. Your premiums greatly depend on your credit history. Your insurance company uses standard criteria to determine your credit performance. If, at one time, you delayed renewing your policy, this will negatively affect your credit performance. Your insurance company might raise your premiums if they consider you a high-risk member. Moreover, some insurance companies might also charge penalties and fees, in addition to the premiums, depending on how long you took to renew your policy.
This can happen when your policy is terminated by one insurance company and you apply for a new one with a different company. When this new insurance company looks into your history and discovers that your policy was terminated by the previous insurance company due to delayed renewal, they may reject your application. However, if they do accept your application, you might be required to pay high premiums. This is because they consider your credit history when determining your premiums, and you are now recognized as a high-risk customer.
How to Avoid Delayed Insurance Renewals
One of the best ways to avoid delayed insurance renewals is by settling the policy in full. If you pay your premiums all at once, you will not have to struggle with delayed renewals. If that strains your pocket, you can decide to pay in installments, but you’ll need a good budget to ensure that you do not spend the renewal money on something else. You can also make arrangements with your insurance company and your bank, so that your policy is automatically renewed.
Do not hesitate to give Key City Insurance a call at 866-466-2109 for more information on Victorville business insurance policies that will guarantee your maximum security.