Will my premium be refunded if I want to cancel my home insurance policy?
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Will my premium be refunded if I want to cancel my home insurance policy?
You will get refund if you haven't claimed anything on the policy. Please read the policy documents for more info on the same.
Just checked with customer care executive and he told me that there are two types of refund type - Pro-rata and other one I have missed. Can you please tell me which one is good for me.Quote:
Originally Posted by Arvind kumar
Pro-rata Cancellation
When the policy is terminated midterm by the insurance company, the earned premium is calculated only for the period coverage was provided. For example: an annual policy with premium of 100,000 is cancelled after 40 days of coverage at the company's election. The earned premium would be calculated as follows: 40/365 days X 100,000=.110 X 100,000= 11,000.
Short-rate Cancellation
When the policy is terminated prior to the expiration date at the policyholder's request. Earned premium charged would be more than the pro-rata earned premium. Generally, the return premium would be approximately 90 percent of the pro-rata return premium. However, the company may also establish its own short-rate schedule.
So you have only one option Short-rate Cancellation.
Source - about.com