What is an insurance endorsement?

An insurance endorsement is a change to the policy. Understand how it works.

When you take out car insurance, the intention is to keep it for the contracted period, normally one or two years. However, plans may change and an insurance endorsement may be required.

But, before you have any more questions about this procedure, we have gathered information so that you can better understand what it is about.

When taking out car insurance, the risk to the insured and the situations involving the insurance are assessed. And based on this assessment, the value of the prize is stipulated.

However, there are some situations in which changes may occur, such as:

• The insured person changes address;
• Change vehicle;
• Changes in vehicle usage habits;
• Transfer of insurance and others.

Any change must be communicated to the insurance company and this must be recorded through an endorsement.

The insurance endorsement is nothing more than a document that aims to change some conditions of the policy.

Image: Getty

Why do I need to endorse?

It is very important that the information is up to date with the insurance company, this means that all data must be correct. If there is an accident, an assessment is made of the veracity of the information provided and if there is any discrepancy there is a risk that the compensation will not be paid.

Let's assume that the insured person changed jobs and now the new job is 15 kilometers further away. If he suffers an accident while going to work on a route that was not communicated to the insurance company, he runs the risk of not having the car repairs paid for.

When I make an insurance endorsement, does the value increase?

This can happen, since the risk is calculated based on the information provided by the insured and the vehicle usage habits.

If the risks increase, the value tends to rise, making it necessary to pay this difference. However, the opposite can also occur and the insurance becomes cheaper, in which case the insurer returns the difference in value, according to the rules set out in Susep.

Is the endorsement also valid for changing coverage?

The most common thing is that the data related to the vehicle's risk is changed, however, it can also be used to change the types of coverage.

If more coverage is added, the insurance value increases. And if they are removed, this value decreases.

Is it more worthwhile to get an endorsement or take out new insurance?

This will depend on what the insured is looking for. If he is going to continue with the same insurance company, it may be more interesting to get the insurance endorsement and make the changes he wants.

However, if the idea is to change insurers, then you must cancel your current insurance and take out a new one.