The insured is obliged to offer to renew at each renewal date on the same terms as applied in the immediately preceding period of insurance. The insurer's obligation is to grant the discount if the offer is accepted.
However, the insurer is not required to accept the renewal offer, can alter the premium from that previously charged and can alter the terms and conditions. The insured is not obliged to renew if the insurer alters the premium or terms, but he will have to reveal the effective declinature of the insurer to those insurers whom he approaches.
The long-term agreement is clearly biased in favour of the insurer, because a commitment to a specified rate of premium is worthless from the insured's point of view unless identical or near-identical terms continue to apply.
This point was recently made clear by several insurers' decisions to remove terrorist cover from their UK policies, despite the existence of long-term agreements under which the insureds felt secure that they had firm commitment for three years or more to the policy terms previously agreed.
This also demonstrates the fact that insurers will usually renew unless different external factors which may substantially affect the policy, such as an increase in terrorist activity, have occurred, or they realise that the risk was originally misunderstood or otherwise misrated. Usually insurers will continue the insurance, although they may feel obliged to increase the premium or reduce the risk by requiring the insured to comply with additional warranties.
If the insurer feels unable to renew, then the insured must reveal this fact to any other insurer whom he approaches, because technically his offer has been refused. Nevertheless, the long-term agreement is often used and its wording is critical.
Poorly drafted clauses can result in the agreement becoming a continuous contract cancellable after three years or a three year contract which is automatically renewed twice, instead of a one year contract capable of renewal.
Willis J. Watson is a freelance writer since 2006, living in United States and he writes about he enjoys the most...insurance policies. If you want to read more informations about Landlord Insurance Quote and also read more reviews about Commercial Insurance Quotes, you can check out his websites.
However, the insurer is not required to accept the renewal offer, can alter the premium from that previously charged and can alter the terms and conditions. The insured is not obliged to renew if the insurer alters the premium or terms, but he will have to reveal the effective declinature of the insurer to those insurers whom he approaches.
The long-term agreement is clearly biased in favour of the insurer, because a commitment to a specified rate of premium is worthless from the insured's point of view unless identical or near-identical terms continue to apply.
This point was recently made clear by several insurers' decisions to remove terrorist cover from their UK policies, despite the existence of long-term agreements under which the insureds felt secure that they had firm commitment for three years or more to the policy terms previously agreed.
This also demonstrates the fact that insurers will usually renew unless different external factors which may substantially affect the policy, such as an increase in terrorist activity, have occurred, or they realise that the risk was originally misunderstood or otherwise misrated. Usually insurers will continue the insurance, although they may feel obliged to increase the premium or reduce the risk by requiring the insured to comply with additional warranties.
If the insurer feels unable to renew, then the insured must reveal this fact to any other insurer whom he approaches, because technically his offer has been refused. Nevertheless, the long-term agreement is often used and its wording is critical.
Poorly drafted clauses can result in the agreement becoming a continuous contract cancellable after three years or a three year contract which is automatically renewed twice, instead of a one year contract capable of renewal.
Willis J. Watson is a freelance writer since 2006, living in United States and he writes about he enjoys the most...insurance policies. If you want to read more informations about Landlord Insurance Quote and also read more reviews about Commercial Insurance Quotes, you can check out his websites.
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