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Insurance 101
Why Do I Need To Complete A Proposal Form For Motor Insurance?
Written by Richard Ramdwar
C.I.P., M.S.T.I, A.C.I.I
Managing Director of Nautica Insurance brokers and creator of Starfish.
Motor insurance is essential for every driver, whether you're zipping around the city or taking long road trips. However, before you can get coverage, you’re required by the insurer to complete a proposal form. You might wonder, "Why is this form so important?" or "What’s the purpose of all these questions?" Let’s dive into why completing a motor insurance proposal form is crucial for both you and the insurance company.
Accurate Risks Assessment
Insurance companies use the information provided in the proposal form to assess the risk they’re taking on by insuring you. Details such as your driving history, vehicle type, and previous insurance claims help them evaluate how likely you are to make a claim in the future. This assessment ensures that you get an insurance policy tailored to your risk profile, which in turn affects the premium you pay.
Legal Requirements
In Trinidad and Tobago, motor insurance is a legal requirement under the existing legislation Motor Vehicles Insurance (Third party) risks act Ch 48:51. The proposal form acts as a formal contractual application that provides proof that you have disclosed all necessary details to the insurer. Failing to complete the form accurately could result in legal issues or invalid coverage, leaving you unprotected in the event of an accident.
Transparency & Trust
When you complete a motor insurance proposal form, you’re building trust with the insurance company. You're essentially making a declaration about your driving habits, vehicle details, and claims history. This transparency ensures that both parties are on the same page regarding the terms of the policy. If any information is left out or inaccurately reported, it could lead to disputes when you need to make a claim.
Customised Coverage
Not all drivers are the same, and neither are insurance policies. By filling out the proposal form, you provide essential details that allow the insurer to offer you the right coverage.
For example, if you have a modified vehicle or if you frequently drive in high-risk areas, the insurer may recommend additional coverage options. This ensures you’re adequately protected based on your
unique needs.
Accurate Premium Calculation
The premium you pay for motor insurance is directly linked to the information in your proposal form. Insurers need to know key details like the type of vehicle you drive, your driving history, and whether you have any no-claims bonus (NCB).
Without accurate information, you might end up paying more than necessary or, worse, underestimating the risks, which could result in higher out-of-pocket costs during a claim.
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One of the biggest risks of not completing a proposal form properly is having your claims rejected in the future. If an insurer finds that the details on your form were incomplete or inaccurate, they may deny coverage when you need it most. Filling out the proposal form thoroughly helps you avoid such issues and ensures a smooth claims process when the time comes.
CONCLUSION: A SIMPLE STEP TOWARDS PEACE OF MIND
Completing a motor insurance proposal form might seem like a routine task, but it plays a pivotal role in securing the right coverage for your vehicle. It ensures that you’re legally compliant, helps insurers assess risks accurately, and sets the foundation for a reliable insurance policy. By providing complete and honest information, you’re taking the first step towards driving with confidence, knowing that you’re properly protected.
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Our Team at Nautica will send you this form as part of our enrollment package and will assist you to complete the form in advance of your first years coverage.