What is an insurance contract?
The insurance contract is the legal bond which unites an insurance company to a subscriber, the insured, and which commits them to certain obligations and certain rights. Each of us has at least one insurance contract: home, auto, health insurance, school insurance, etc. The contract, also called an insurance policy, may seem complex due to the multitude of information it contains and the features that surround it. So what is it for? What is its content ? How to terminate an insurance contract? Is it possible to withdraw after signing? We help you see more clearly.
Summary
- Definition of the insurance contract
- How to terminate an insurance contract?
- Standard letter of cancellation of an insurance contract
- What information must an insurance contract contain?
- Where can I find my insurance contract number?
- What are the different types of insurance contracts?
- What is the withdrawal of an insurance contract?
Definition of the insurance contract
An insurance contract is a "contract by which the subscriber is promised by an insurer, on his behalf or that of a third party, a generally pecuniary benefit in the event of the occurrence of a risk, in return for the payment of a premium or contribution”.
A risk is an uncertain event that occurs beyond your control. In other words, a risk represents the probability that harm will occur randomly. You therefore insure yourself against this potential accident, whether it is related to your person or your property. It is the definition of this risk that allows your insurer to establish the insurance premium, ie the contributions that you will have to pay to the insurance company to be protected.
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In addition, the insurance contract contains all information relating to the rights and obligations of both the insurer and the insured, the general and specific conditions of the insurance, the rules for terminating the insurance , certain clauses imposed by the law, etc
As a general rule, the insurance contract is taken out for a period of one year , very often automatically renewed. This means that it is renewed automatically if you do not express your wish to stop it. This is the case for most property and casualty insurance such as home, auto, motorcycle, school insurance, etc. However, there are contracts of a more variable duration, such as for borrower insurance for example.
As soon as you have the slightest doubt about the assumption and compensation of damage by your insurance, refer to your contract, which absolutely rules all the terms of the insurance.
In USA, everyone is affected by insurance contracts because several insurances are compulsory . Civil liability is the minimum guarantee to have: everyone being responsible for damage caused unintentionally to others, the civil liability guarantee replaces the person responsible in the event of a claim and compensates the victim on your behalf.
Health insurance is the second compulsory insurance and therefore common to all: everyone is affiliated to Social Security.
In addition, there is conditional compulsory insurance : you must take out a car insurance contract if you have a car, home insurance if you are a tenant, damage-work guarantee insurance if you are building... Professional insurance has also been gradually introduced to meet the specificities of certain professions, such as medicine, construction and building, law, etc.
An insurance contract can be individual or collective. For example, private companies must all offer their employees collective mutual insurance.
Characteristics of an insurance contract
The insurance contract brings together a few characteristics that are specific to it. Indeed, it is:
- Consensual , since it is the result of an agreement of wills. No one can force you to sign insurance contract A with insurer D, for example. Insurance may be required by law, but you should always have a choice of contract.
- Random , because its realization is subject to the occurrence of an uncertain event: risk.
- Synallagmatic , since it makes the insurer and the insured each have obligations towards each other.
- Membership , drafted by the insurer.
- For payment , because it is subscribed in exchange for a financial participation.
- Successive , because it is spread over time.
- Regulated by the Insurance Code.
How to terminate an insurance contract?
You can terminate your contract on its expiry date , without giving any reason or incurring any financial penalty. All you have to do is send your insurer a registered letter, preferably with acknowledgment of receipt. The maturity date corresponds to the anniversary date on which you signed the contract. It is necessary to pay attention to the fact that most insurance contracts are automatically renewable, that is to say that they are automatically renewed each year, for an additional year.
Since the Chatel law, insurance companies must warn their policyholders of their possibility of terminating their contract on expiry. They must therefore send them a notice of expiry between 3 months and 15 days before the termination deadline, this being 2 months before the end of the contract.
The insurances concerned by the Chatel law are all contracts with tacit renewal : housing, car, motorcycle, school, unpaid rent, dependency, complementary / mutual health insurance.
Consequently, professional contracts, group insurance, life insurance and contracts covering legal persons are not bound by the Chatel law.
Terminate after expiry
Termination after the expiry date means that you do not wait for the anniversary date of your contract to terminate it. After one year of membership, the breach of a contract can be done at any time without having to justify yourself, and this thanks to the Hamon law on consumption which promotes competition and protects consumers. Not all insurance is affected by the Hamon law: only car, motorcycle, home, borrower and affinity insurance contracts can be canceled after one year of membership at any time, without reason, without penalty.
During the first year, you can terminate your contract without waiting for the expiry date in certain cases only:
- Your situation changes following an event such as a retirement, a move, a divorce, a marriage, a cessation of activity, a change of profession... Please note, you have 3 months following the occurrence of one of these events to inform your insurance company.
- Your insurer refuses you a premium reduction although your risk is decreasing.
- You sell the property covered by the insurance.
- You must subscribe to the compulsory mutual insurance of your company.
- Your insurer increases your insurance premium without being justified.
All insurance contracts can be canceled during the first year if the reason for cancellation is part of this list.
In any case, if you wish to change your insurance contract, it will be beneficial for you to compete with the various offers on the market by comparing them! Insurance broker , Réassurez-moi offers you its online comparator, which is independent. Whether you are looking for auto, motorcycle, home, borrower insurance (…), you will be able to access personalized quotes quickly, anonymously, and for free. Our experts remain, at the same time, available for any additional information.
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Standard letter of cancellation of an insurance contract
To announce that you wish to end your insurance contract , a registered letter with acknowledgment of receipt must be sent to your insurer. This letter can be physical or sent electronically. Indeed, you can send your registered letter online, it is legally accepted provided you go "through a third party according to a process allowing to identify the third party, to know the sender and to guarantee the identity of the recipient". Acknowledgment of receipt is essential.
A termination letter should contain:
- Your surname, first name, postal address, your insurance number.
- The contact details of your insurance company.
- Subject: your desire to terminate your contract number xxx.
- The reason, if necessary.
You can take example from the two standard termination letters written by our experts. You can therefore download below a termination letter on expiry, and another off expiry, for home insurance. Of course, you are free to modify them according to your situation!
Standard termination letter on expiry – home insurance
- Your surname, first name, postal address, your insurance number.
- The contact details of your insurance company.
- Subject: your desire to terminate your contract number xxx.
- The reason, if necessary.
What information must an insurance contract contain?
The insurance contract contains the general conditions describing the rights and obligations of the parties, as well as the guarantees that may be included in the contract. These are the conditions common to all the contracts of an insurance company. In addition to these general conditions, the contract includes the special conditions, which include the data specific to an insured. You will also find in this content special agreements, or other appendices whose name varies but which relate to the risks covered.
Thus, you can refer to your insurance contract at any time if you have any questions about:
- The deductible in the event of a claim.
- Waiting periods.
- Compensation caps.
- Rights holders.
- Insurance cancellation deadlines .
- Insurance adjuster coverage.
- Disclaimers of Warranties.
Certain information, such as the contract number, the name of the insured and the date of subscription, is included on the certificates and certificates of insurance. These are proofs of insurance which may be used as proof and may be requested from you.
Where can I find my insurance contract number?
Each subscription to a contract results in the creation of a unique number : the insurance policy number . This police number can be useful to you during an accident report, at your children's school or when you rent a vehicle, for example.
Each contract has its own policy number, recalled in various places:
- The contract itself
- The insurance certificate (in car / motorcycle insurance, it is the green card).
- The insurance certificate (for car insurance, this corresponds to the green sticker).
- On your correspondence with your insurer.
- In your online customer area.
- On your notice of expiry , received each year.
If you can't find it, you can call your insurance company and ask them to re-provide it to you.
What are the different types of insurance contracts?
There are two different types of insurance contracts: damage insurance and personal insurance. Damage insurance covers damage to property, as well as payments to which the insured is liable for damage to others. We can therefore cite civil liability, school insurance, car / motorcycle insurance, unpaid rent insurance, travel insurance.
Personal insurance covers everything that affects the insured himself or the beneficiary, such as health, death, disability insurance, etc. This insurance can be individual or collective. A 3rd type was born from the first 2: multi-risk insurance, which covers the risks of property and people. The most subscribed home insurance is multi-risk.
What is the withdrawal of an insurance contract?
You can only withdraw after signing a contract if it was done following canvassing, whether physical, by telephone or online, or remotely. The Insurance Code gives a withdrawal period of 14 full calendar days following the subscription to the contract. To withdraw from your insurance , simply send a registered letter with acknowledgment of receipt. Note that if a claim occurs during this period, it is no longer possible to retract!
It is possible to waive all non-professional contracts concluded at a distance , except for a few, which you can find in the table below:
Possible withdrawal Cancellation not possible
- Home Insurance Yes No
- Professional insurance Yes No
- Car Insurance No Yes
- Mutual health Yes No
- Travel and baggage insurance No Yes
- Borrower insurance Yes No
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