Is it possible to do this?
Termination of the contract means the completion of the accepted agreement and the circumstances arising from it, the execution date of which has not yet arrived. Based on paragraph 1 of Article 450 of the Civil Code of the Russian Federation, according to the accepted rule, the agreement of the parties is the basic principle for the completion of contractual obligations, unless otherwise provided by law. Otherwise, the cancellation of the contract is carried out through the court.
Attention! Termination of the MTPL agreement is the termination of the MTPL policy earlier than the period specified in it at the request of one of the parties.
Cancellation of an insurance transaction is possible at any working time, both at the request of the insurance company and the client, on the grounds provided by law.
At the same time, the Civil Code (clause 2 of Article 958) gives each policyholder the right to refuse the contract without explaining the motive for this action. But then you will have to sacrifice the money paid for the policy.
Grounds for cancellation of compulsory motor liability insurance
The main factors for potential cancellation of policy protection are described in the MTPL Rules . These include:
- death of the owner of the transport unit;
- complete destruction of transport, the impossibility of its restoration and repair (you can read more about repairs under compulsory motor liability insurance in this article);
- expiration of the insurance company's license;
- change of vehicle ownership.
Other circumstances not specified by law, such as a personal desire to change insurance company, may also serve as a reason.
Policy closure rules
The main document that regulates the process of closing a policy is Bank of Russia Regulation No. 434-P dated September 19, 2014.
In order to cancel the contract, you need to contact the insurer’s office with a package of required documents.
Only the owner of the vehicle , the policyholder who owns the car, or the policyholder who has a power of attorney to accept funds from the owner of the vehicle, as well as their heirs, can cancel the MTPL policy. We talked in more detail about who the policyholder and the owner are here.
Important! The insurance company itself has the right to terminate the MTPL contract if it discovers that the client provided false information about himself or the vehicle when applying for a policy. Especially if hidden information increases insurance risks.
The list of documents required to cancel the MTPL agreement depends on the reason for it. So, upon the death of the owner of the vehicle, the heir must bring the original policy to the insurance company, a receipt for payment of its cost, a death certificate of the insured and a document confirming entry into the inheritance. The agreement will terminate immediately.
If the vehicle is completely destroyed as a result of an accident, force majeure, or due to participation in the state car recycling program, the insurer will require the policy itself, a receipt for its payment and a vehicle disposal certificate.
When an insurance company loses its license or its license expires, it is very difficult for motorists to get their money back.
If all the necessary papers are provided, the policyholder writes a statement indicating:
- name of the insurance company;
- full name of the policyholder;
- MTPL policy details;
- reason for canceling the contract;
- option to accept the due money from the insurer;
- list of attached papers.
The day the application is accepted is also the day the insurance contract is terminated. The day following it begins the non-insurance period, which lasts until the end of the policy period.
After canceling the contract, the company must provide the citizen with Information on OSAGO , which provides information about the owner and his vehicle, data on insured events that have occurred, insurance payments made and directions issued for repairs. This certificate is issued free of charge within five days after application. This is followed by the transfer of funds for non-insurance months in due time.
Policy expiration date
The policy ceases to be valid the very next day from the date of application. If you contact the insurance company too late, the amount of compensation will be minimal. Therefore, if there is little time left until the end of the policy, it is more advisable to wait until the end of the contract and not renew it.
When selling a car, the date of termination of compulsory motor liability insurance will be the date of filing the application. In the event of the death of the policyholder or the disposal of the car, the date of termination will be considered the date of occurrence of this event.
How is the contract terminated?
Procedures for canceling a transaction under compulsory motor liability insurance vary depending on the circumstances.
When selling a car
A transport unit can be transferred under a purchase or sale transaction, exchange or gift to another person; here the MTPL policy does not protect the new owner, and the former owner can apply to terminate his protection.
The policyholder can cancel the MTPL agreement in connection with this case only after the purchase and sale transaction itself has been completed. Then the required documents are immediately collected:
- passport or other identity document;
- original agreement with the company;
- receipt for payment of the cost of the policy;
- transport transfer agreement;
- in some cases, a vehicle passport with information about the new owner included;
- sometimes - the current account number for transferring money if the company does not return the money in cash.
Attention! It is best to clarify the necessary documents before going to the insurance company by calling the employees or information on the organization’s website.
Then the citizen’s application will be immediately accepted, and this date will be the starting point for calculating the financial resources to be returned to the former owner.
Early at the initiative of the policyholder
In life, situations arise when a car owner decides not to drive a car yet or leaves for a long time, and the vehicle remains unclaimed, or the insurance company performs its duties improperly.
Then the client decides to close the MTPL policy.
Insurance companies do not aim to lose their clients, so it is very difficult to terminate a contract for reasons not included in the main list of its termination, and at the same time receive money for unused months.
In this case, the MTPL rules provide for the insurer's right not to return money for the unused period , therefore, if possible, it is more profitable for the policyholder to leave the current MTPL policy and at the end of the insured period receive a good characteristic, which makes it possible to obtain the next policy at a lower price.
Cancellation of additional insurance
In practice, there are cases when a citizen inattentively reads the MTPL contract, and it may indicate consent to additional insurance, for example, for the risk of harm to life, which increases the price of insurance by at least a thousand rubles.
Or a company employee persistently imposes a comprehensive insurance contract, and the client succumbs to influence.
If, nevertheless, it was drawn up, then it can be abandoned even after the conclusion of an agreement on compulsory motor liability insurance. In this case, the entire contract is canceled and a new one is drawn up, which does not include additional insurance.
Important! Additional insurance is not mandatory and is issued only with the consent of the policyholder.
To do this, it is necessary to draw up a competent application for refusal of such a compulsory motor liability insurance policy. It must state:
- to whom and from whom the application is drawn up;
- the essence of the transaction in which the policy buyer was not informed about additional services or they were presented as mandatory;
- on laws that protect citizens from purchasing goods and services that they do not need at the moment (Law “On the Protection of Consumer Rights”, paragraph 2 of Article 16);
- about the desire to terminate the agreement and return the amount paid for the policy;
- list of attached documents;
- date of preparation of this application.
A signature is placed and this written request, together with the attached papers, is given to an employee of the company, who cancels the agreement after reading them, as is customary, on the same working day.
If the company refuses to cancel the transaction, you should report this to its central office. If this does not help, then notify the Russian Insurance Association or file a lawsuit.
Read more about what to do if additional insurance is imposed on you here.
Refund upon termination
When wondering: how to terminate compulsory motor liability insurance and return the money, it is important to remember that, according to the law, the following can receive funds for the unused part of the insurance premium:
- owner of the vehicle;
- the policyholder who is the owner of the vehicle;
- an insured who does not act as an owner, but acts by proxy;
- persons who are heirs of the deceased policyholder.
Provided that the package is correctly compiled at the time of termination of the MTPL policy, the insurance organization undertakes to return the funds within 14 calendar days from the date of receipt of the application.
If the return was not made within the specified period, the client has the right to file a complaint with the Central Bank or resort to the assistance of the judiciary.
Payment cannot be received only if:
- closure of the insurance company;
- detection of inaccurate data previously provided by the policyholder.
Due payment
The insured client is obliged to receive payments remaining until the end of the insurance period.
Moreover, this period is counted from the moment the application from the motorist is received by the company where the policy was purchased. The time of actual cancellation of the contract does not play a role here.
The amount payable is determined as the unspent insurance premium minus 23%.
These percentages go towards reimbursement of expenses for terminating the insurance business (20%) and mandatory deductions to the RSA (3%).
Reference. Many motorists managed to return the deducted interest through the courts, but after the adoption of amendments to the Law and Rules on Compulsory Motor Liability Insurance, this is almost impossible to achieve.
In case of cash payment, the citizen receives the money on the same day. With non-cash payment, the waiting period for the debt increases to 14 days.
If during the insurance period the company made payments for insured events, this will not in any way affect the remaining value of the policy after its early closure.
Failure to receive the required money gives reason to contact the head office of the insurance company with documents and a copy of the submitted application to clarify the circumstances. If the campaign does not produce positive results, then contacting the Union of Russian Insurers, an organization that regulates the activities of insurance companies, will help.
But there are cases when payment of the remaining money is not provided:
- the policy is closed at the request of the client for a reason not included in the main list of reasons for termination of the contract;
- the insurer ceased to exist;
- The insurer discovered false information about the client and his vehicle.
Thus, being clearly aware of their rights and knowing the process of stopping the MTPL agreement, the policy buyer can cancel the contract with the least time and financial losses, and in case of problems with the organization, defend their case in higher organizations.
What if the money has not been paid?
If, after a two-week period of time, the corresponding payment has not been made by the insurance company, then first you should contact the central office of the insurer. It is possible that the money is stuck at the accounting level. If the payment has been made, then the logical solution would be to re-check your own account.
However, there are situations in which the insurance company refuses to make payments. In this case, you should prepare a photocopy of the policy and a statement of its termination, and then go to the Union of Russian Insurers . This organization regulates the activities of insurance companies, so it can influence insurers.
The Union may take appropriate measures and punish the insurer for improper performance of professional obligations. It is even possible to decide on membership in an association as a punitive measure. Such punishment is considered quite harsh, so filing a complaint with the Union of Russian Insurers is a more effective solution than going to court.
