The presence of insurance policy CTP is a mandatory requirement for all car owners.
Using a vehicle without insurance is prohibited – for this the driver is entitled to a fine.
However, in some cases, an already issued policy becomes unnecessary for the policyholder, as a result of which he can return the money spent on it.
What are these cases and how does the refund process look like? Consideration of these questions will be interesting for all car owners.
Early termination of the contract OSAGO and refund for unnecessary policy
The rules of CTP, according to which the car insurance procedure takes place, allow for the possibility of terminating the contractearlier than the established time.
The client can do this at any time, without even explaining the reasons that prompted him to do so.
However, in this case, all the moneypaid by him for insurance will not be refundedand will remain with the insurance company.
To return a part of the amount paid for the policy that was not used by the policyholder, you must provide the company with documents confirming the reasons for this.
The grounds for return must be substantial – the most common are enshrined in law.
It will not be possible to return the money for insurance in the following cases:
- The termination of the contract is initiated by the insurer.
The legal basis for this may be the identification of the fact that the client provided the employees of the insurance company with incomplete or inaccurate information about themselves, as a result of which the cost of the policy was underestimated.
This may be false information about the driving experience, the horsepower of the car and other factors that affect the cost of insurance.
- The insured wants to terminate the contract due to a long departure, during which he will not use the car.
Of course, it is possible to make a statement to the insurance company, but the answer is unlikely to be positive.
It is also impossible to return the money in some cases of liquidation of the company – if it occurs due to bankruptcy.
In this situation, a legal entity is recognized as insolvent, so it may simply not be enough money to pay all its obligations.
In which cases it is possible to return a part of money for OSAGO?
If there are valid reasons, the policyholder can easily return the money for the unused portion of the policy.
The most common reasons for return are:
- Change of ownership of the vehicle. You can return the money for insurance in the event that the car is sold under a contract of sale. For situations in which it is transmitted under a general power of attorney, this possibility does not apply.
- Loss or death of the car. This includes cases such as car theft or damage that cannot be repaired. If the vehicle surrenders under a recycling program or is not recoverable, you can return the money for its insurance.
- The death of the owner. In this case, the car, as well as the sale, will change the owner, so the previously concluded contract will be invalid.
- Death of the insured. Since it is one of the main parties to the transaction, such an event leads to the invalidity of the contract – employees of the insurance company will be obliged to terminate it.
- Liquidation of a legal entity(in cases where the insured car was in its ownership). Just as in the previous case, one of the parties to the transaction disappears, so it becomes invalid.
- Deprivation of the insurer license. This situation is controversial and does not always lead to the payment of a portion of the cost of insurance. If the company revokes the license in connection with the impending bankruptcy, it is better to hurry with a statement about the return of money. If the bankruptcy procedure begins, they may not be returned.
When selling a car, it is not necessary to terminate the contract and receive part of the insurance premium back.
As an alternative, you can sell the vehicle with insurance – to include the policy in the price of the car.
In the insurance company, in this case, it will only be necessary to reissue the contract for the new ownerand, if necessary, pay some of the money for the policy (if, for example, his driving experience is less than that of the previous owner).
The choice of the method of refund is entirely the policyholder.
Calculation of the amount to be returned
The amount that the policyholder can get back depends on two factors: the amount of insurance and the number of monthsremaining until the end of its use.
The calculation of the amount is as follows:
B = (PS – 23%) * (n / 12), where:
- B– amount to be returned,
- PS– the full cost of the policy,
- n– the number of months that remained until the end of the insurance.
As for the value of 23%, it consists of two elements:
- 3% of the cost of the policy is deducted in the PCA;
- 20% goes to pay for the costs of doing business(documentation, salary to employees, etc.).
This part of the money is often taken away from the policyholder, but not everyone agrees.
Many clients go to court and try to prove that charging 23% is illegal.
Most of the court decisions in this case are positive, since there is no clear indication in the law regarding the obligation of such deductions.
Who can get money at the termination of CTP
The recipient of the unused value of insurance depends on what is the basis of the termination of the contract.
The following persons may return the money:
- Heir to the deceased policyholder.
- The legal representative of the insured.
- The owner of the vehicle.
- Heir to the deceased owner.
- The legal representative of the owner.
In the event of the appeal of the money of legal representatives, a general power of attorney(on behalf of the owner or the insured) must be executed.
A prerequisite for such a power of attorney is the presence in it of indicating the possibility of conducting operations with monetary funds.
Terms of refund
In accordance with the rules of insurance OSAGO, the client must return the money for the policy no later than 14 days after submitting the application.
In some cases, the money is given immediately after the appeal – in cash on hand.
In other companies, they can be transferred to a bank account within the prescribed time.
If the company violates the deadlines and does not transfer money, even after repeated treatment, the policyholder may sue it.
Of the necessary documents is to prepare a copy of the policy OSAGO, payment receipt and an application for a refund.
Required documents and procedures
To return the cost of the policy, the policyholder must come to the insurance companywith a package of supporting documents.
They can be divided into two groups.
Provided in any case, regardless of the grounds of return.
- copy of insurance policy;
- copies of the pages of the insured’s passport;
- payment receipt of the policy.
Are evidence of the validity of the reasons for termination of the contract.
It may be:
- contract of sale;
- general power of attorney;
- certificate of entry into the inheritance;
- death certificate of the owner or policyholder;
- certificate of removal of the car from the register;
- documents confirming the liquidation of a legal entity.
Both copies and originals of these documents are required.
With the help of an employee of the company, the policyholder can write a statement about termination of the contract (indicating the reason) and attach the necessary documents to it.
Within the prescribed time, the money must be returned.
Is it always worth terminating the CTP contract
Termination of the insurance contract and receipt of the remaining amount of money is not advisable in all cases.
For policyholders who will continue to apply for new insurance anyway and use a car, it may be more profitable to wait until the expiration date of the contract.
This is especially the case when the policy is about to end.
The benefit is that, as a reward for a trouble-free ride, the driver receives a KBM(bonus-malus coefficient), thanks to which you can get a discount on the next policy.
The discount will be increased only if the contract is valid for a year – with early termination, the MSC rate will not change.
Therefore, in this case, it is worthwhile to calculate what is more profitable – to take part of the paid insurance in cash or to receive a large discount on the following policy.
In conclusion, it is worth noting that:
- The right to early termination of the contract OSAGO have all the drivers, regardless of the grounds and reasons for this.
- You can get back a portion of the paid insurance only in statutory cases: when the owner of the vehicle changes, after his death or as a result of the car’s death.
- With early termination, the right to decline to the insurer of the MSC is lost – its value remains the same.