If you have an insurance policy, the coronavirus outbreak might have had an impact on the suitability of your existing policy and the cover you require. This guide will look at what insurance companies might do and go through a variety of examples to help you understand how your insurance needs might have changed.
Under new rules, during the coronavirus outbreak insurance companies will:
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These could mean a reduction in your monthly premiums or a partial refund on your policy.
If you’re struggling to make your monthly repayments, you might be offered or can ask for a payment holiday, also known as a freeze of up to three months.
If you your insurance needs have changed due to the coronavirus outbreak and you think you might be entitled to a reduction or refund, you need to contact your insurer.
You will need to explain how your needs have changed, or why you no longer need cover. This could potentially extend to insurance add-ons you brought at the time you took out your policy.
For example, if you use your car to travel to and from work or use it for business, but are now working from home, the number of miles you travel annually could be significantly less.
Reducing the number of miles, you travel on your policy could reduce your premiums, so you might be entitled to a reduction in your premiums or a partial refund.
However, it’s important to remember, changes to your policy are likely to be small, so this is not likely to be a large amount of money.
Many people’s insurance needs will have changed because of the coronavirus outbreak. However, it’s important to think about if you still have the right amount of cover for your needs.
For example, if you have an annual travel insurance policy you may now not want to travel abroad so might consider asking your insurer for a partial refund on your annual premium.
This means before you make any decisions over your insurance policy you need to consider what cover you do still need as any decision could have a significant impact on claims in the future.
If your insurer decides your current policy no longer meets your needs due to coronavirus, they might suggest an alternative policy which is more suitable.
If this option is available, then you need to understand what is covered under the new policy, and for how much money.
All of this information will be laid out in your new insurance policy documents and it’s important you read these carefully before agreeing to a new policy.
Any charges and fees you would normally have to pay for switching or to make changes to your policy should be waived.
At some point in the future, your insurance needs are likely to return to normal. But your insurance will not automatically switch back.
When you know when your insurance needs are likely to go back to normal, or if your requirements or personal circumstances change, for example if you start a new job, or take on a second job, you should contact your insurer as soon as possible to let them know. This way you will not be at risk of invalidating your insurance.
One of the most common kinds of insurance you have which might have been affected by the coronavirus outbreak is your car, van and motorbike insurance. Some examples of how your needs might have changed include:
You might also no longer have need of some extras attached to your policy such as:
Travel plans have been one of the areas most affected by the coronavirus outbreak. This will have a knock-on impact on your travel insurance including:
There might also be optional extras included in your policy such as:
Anyone not travelling soon, might consider requesting a refund on their annual or multi trip travel insurance premium but remember any policy brought before the coronavirus pandemic will cover you for COVID-19-related claims while a new policy may not.
During the coronavirus outbreak, you are likely to be spending a lot more time at home, so it’s unlikely your insurance policy needs will have changed in the same way as they might for vehicle and travel insurance.
However, there might be some extras on your policy which you don’t need during this time such as additional cover for when you’re away from home.
However, there is likely to be little impact or benefit from removing these from your policy.
It’s very unlikely that your health and life insurance policies will be directly impacted by coronavirus. Although it’s always a good idea to review your policies regularly we recommend continuing with your current policies at present if they still meet your needs. This will help prevent any issues which might affect a coronavirus claim or your premiums in the future.
If your struggling to afford to afford your premiums, then you should speak to your insurance provider who can discuss your options.
It’s also likely any new long-term income protection policy you take out now will have an exclusion period to prevent any COVID-19 related claims during this time.
This article is provided by the Money Advice Service.