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Car insurance changes to cover

If your circumstances change at all or the car is changed in any way you are obliged to notify your Car Insurer immediately otherwise your cover will be invalid. All Car Insurers draw their policyholder’s attention to the need to notify them promptly of any change of vehicle and print a notice along the following lines on the reverse of their certificates of motor insurance.

This certificate of insurance applies to your present car and any replacement car which is your property.
You should, however, tell us immediately of any change of vehicle. Your attention is drawn to the condition of your policy by which the indemnity provided is limited to liabilities to third parties required to be covered by the Road Traffic Acts until particulars of the replacement car have been accepted by the company.

If you intend to purchase an additional vehicle you are required to arrange insurance before such vehicle is used on the road.

It should be noted, however, that the ‘Description of Vehicles’ on private car certificates is sometimes worded as follows:

Any motor car owned by the policyholder or hired to him under a hire purchase agreement and registered in his name. This is the nowadays rare ‘driving other vehicles’ clause.

When purchasing a second-hand car there can be a gap, often of weeks, between becoming the owner of the car and completing the transfer of its registration to that of the new owner. Consequently, under the wording described above the motorist will be using the vehicle uninsured and risking prosecution for the offence until such time as the transfer of the vehicle registration to his name has been completed.

The ‘driving other cars’ extension will not provide cover for even third party liabilities during the period of vehicle registration transfer, since this extension excludes cars which are owned by the policyholder or hired to him under a hire purchase agreement.

The conditions of the policy may also restrict the cover the Road Traffic Act liabilities only until the change of car has been notified to the insurers.

These restrictions obviously are vitally important and where insurers use the restrictive wording it is imperative for the change of car to be reported to the insurers (or to the brokers involved, who should then notify the insurers immediately), and a temporary cover note issued before the replacement vehicle is used for the first time.

Indeed, it would not be unreasonable to suggest that any insurer issuing a blanket certificate containing this restrictive wording should ensure that the insured fully understands the position, perhaps by attaching a short notice to the certificate itself;.

Similarly, brokers who pass certificates of this type onto their clients should, ideally, write a brief explanatory note in layman’s terms to the insured so that the position is clearly understood and so and so that there is no chance of the insured being left without cover for any amount of time should he decide to change his car.

Strangely, and perhaps because of the difficulties which may be caused by the requirements, conditions and obligations referred to above – ‘blanket’ certificates are not universally popular, regardless of the expense savings which they may produce; many insurers and insureds alike still prefer to see the insured vehicle’s registration mark shown on the actual certificate of insurance.

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