When am I a defaulter?

Many people pay their insurance premiums late. For some people, it goes so far that the premium for legally required insurance is not paid at all. This can end up having major consequences. How exactly does this work? And what effect does it have if you are registered as a defaulter? You can read about it in this blog.

Suspending insurance

Failure to pay an insurance premium to the insurer on time can result in the suspension of coverage on the policy. Basically, this means that the insurance is put on "pause. For motor vehicles, insurance coverage is suspended if the premium is not remitted within 25 days of the first reminder. You will receive a reminder if the premium has not been received 15 days after the premium due date. The premium due date in this case is the date on which the premium should be collected by the company. So there are a total of 40 days between the premium due date and the time of suspension.

Fine from the RDW

The suspension of the insurance takes place retroactively after these 40 days. The license plate is thus deregistered from that moment onwards at the RDW and has the 'uninsured' status. The RDW regularly checks whether you comply with the statutory insurance obligation. If the license plate is in your name, you are obliged to have at least third-party insurance. The RDW can check this by matching your license plate to an insurance register. If there is no match, the license plate holder will be asked to prove that the vehicle is insured. The moment your insurance is suspended due to non-payment of the insurance premium, you risk receiving a hefty fine from the RDW.

Registered defaulter

If the premium is transferred by the policyholder shortly after these 40 days, the policy will be reinstated in force one business day after receipt of the premium. However, if the premium is still not received by the company 60 days after the premium due date, the company will turn the claim over to a collection agency. The premium will then be increased by the collection costs.

If the collection agency cannot collect the claim, the company will decide to terminate the policy due to non-payment of insurance premiums. This can cause you a lot of problems the moment you apply for new insurance with any insurer. This is because from then on, you will be listed as a defaulter. With a new insurance, there is a big chance that you will be refused as a policyholder or accepted only under special conditions.

Even if failure to pay the premium is due to inattention, it may always come back to haunt you. Therefore, make sure you keep a close eye on the periodic payment of your insurance premium. This can save you a lot of trouble.