How the short auto insurance term table works

Do you know how the short term auto insurance table works? Check out some examples here that will help you understand!

Car insurance is an essential service. However, it requires some research to know which insurance company best meets your needs.

Namely, it may happen that you hire a service and are not satisfied and want to cancel it.

However, when canceling your car insurance, there are some rules to follow if you only want to be charged the amount related to the period in which you used the service.

Therefore, for these occasions, there is a short-term table, guaranteeing the insured's rights in the event of cancellation, whether by the insured or the insurer.

The short-term table is applied in two situations: when the insured wishes to cancel their coverage, or when the insurance is canceled due to lack of payment.

This table exists to identify what the amount paid or reimbursed will be, according to the days of car insurance coverage that was actually serviced.

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How does the short term table work?

The short-term table generally has values ​​up to 1 year. Namely, it is the average duration of car insurance policies from most insurance companies.

It shows the percentage of the full price of the insurance policy that should be charged to the insured, according to the days of coverage used.

Therefore, the short-term table must always be described in the policy and in your insurance contract. In it, it describes the conditions of the service, as provided for by the Private Insurance Superintendency (SUSEP).

Cancellation upon request by the insured and cancellation due to default follow the same rule. The table includes values ​​starting from 15 days of coverage, up to 365 days.

So, if the cancellation is made on a day that is not described in the table, it is recommended to check the value for the earliest date to be applied.

The percentages range from 13% of the total value, in the case of 15 days, to 100% of the policy value, if canceled after 365 days.

How do I know how much I will be reimbursed?

To find out exactly the amount that will be reimbursed, consult the table in your policy. IOF is deducted from the refunded amount.

Therefore, for insurance paid in cash, the calculation is carried out as follows: assuming that your insurance had a total value of R$2000, and you want to cancel your insurance in the third month of the policy.

You have already used the insurance for 90 of the 365 days of the policy. The table states that the percentage value referring to 90 days of use is 40%. In other words, you will have a refund of 60% of the total amount of your insurance. After all, you only used the 40% amount, your refund in this case will be worth R$1200.

For insurance paid in installments, you will have to compare how much you paid and how much should have been paid according to the percentage in the table. For example, your insurance of R$2000 was paid in 5 installments, with monthly installments of R$400.

So, once payment has been requested after 60 days of use, you have already paid 2 installments, totaling R$800. According to the table, the percentage of the total insurance premium to be paid is 30%, which is equivalent to R$600 In this case, the insurance company will reimburse you the difference, which is R$200.

In the case of default, it is the same calculation. Only the monthly fees that were paid are calculated, compared to what should be paid. In many cases of default, there is no refund, but the insured must pay the remainder due.

Namely, in many cases there may be interest charges related to days of late payment of installments.