Have you ever heard of aggravation of risk? If your answer is no, you are like most Quebecers. However, anyone with home, auto, or business insurance should be aware of and understand aggravation of risk.
Dans cet article, Assurances Multi-Risques souhaite vous conscientiser sur l’aggravation de risque afin de vous éviter le pire.
What is risk aggravation?
Risk aggravation is a law that stipulates that you are responsible for informing your insurer of any changes that could increase your risk of making a claim. Risk aggravation is therefore an increase in the likelihood of an incident occurring that could require a claim.
It is important to understand that the nature of these changes would result in a change in your insurer’s premium.
Aggravation of risk stems from an article in the Civil Code of Québec, Article 2466 to be precise!
“The insured is required to promptly notify the insurer of any circumstances that aggravate the risks stipulated in the policy and that result from his or her actions, if they are likely to significantly influence an insurer in setting the premium rate, assessing the risk, or deciding whether to maintain the insurance. Where the insured fails to fulfill this obligation, the provisions of Article 2411 shall apply, with the necessary modifications.”
Example of increased risk in insurance
Let’s take a man named Pierre as an example.
Pierre decides to change his working arrangements and switch to teleworking. He plans to invite clients to his home for meetings. It is therefore in his best interest to notify his insurer of this change. His insurer will be able to adjust his civil liability coverage based on Pierre’s professional activity.
The insurer will adjust the insurance premium accordingly, or may even decide to no longer insure him. If Pierre did not notify his insurer and, unfortunately, a customer fell down his stairs and broke a leg, Pierre would risk legal action, which would cost him much more than an insurance premium.
Notify the insurer of any changes in risk
When it comes to insurance, we recommend that you always be transparent and not hide any information.
Anything you do that could affect your insurance premium must be reported to your insurer. Otherwise, you could lose a lot…
Common cases of increased risk
In the course of our work, we have witnessed several cases of increased risk. We are sharing a non-exhaustive list of cases we have encountered.
- Une maison qui n’est plus habitée (maison ou bâtiment);
- Un conducteur occasionnel (jeune conducteur ou autres);
- L’adoption d’un animal réputé dangereux ou présentant des risques (Pitbull, Doberman, Rottweiler, et les reptiles dont les serpents).
- Un nouveau conjoint possédant un dossier criminel qui emménage chez vous;
- L’exploitation d’un commerce à domicile (ex. : garderie, esthétique);
- L’hébergement de chambreurs à votre domicile (ex. : AirBnB);
- L’utilisation d’un véhicule dans le cadre de son travail;
- L’ajout d’une activité ou d’un service à votre entreprise (ex. : de la soudure hors des lieux spécifiés au contrat d’assurance).
Termination due to increased risk
When an insurer is informed of a change in risk or circumstances, it must reassess your file. It will analyze the risk you represent and make a decision.
If the insurer determines that the risk is too high, it may decide to increase your premium or even terminate your insurance contract. Generally, the insurer will then send you a notice informing you of this termination and giving you a period of time to find a new insurer.
However, please note that canceling your policy with one insurer does not mean that you will not be able to find a new insurer!
Multi-Risk Insurance: Expertise at your service
Chez Assurances Multi-Risques, nous sommes conscients que vos vies sont occupées et que certains détails peuvent vous échapper en matière d’assurance. Cela est d’autant plus vrai si vous ne saviez pas que ce genre de changements devaient être communiqués à votre assureur!
The world of insurance is much more complex than it appears. Every insurance company is different, and every case is unique.
That’s why our best advice will always be to contact your insurance broker if you have any doubts or questions.
Aussi, n’hésitez pas à nous contacter si votre assureur refuse de vous assurer en cas d’aggravation de risques. Nous saurons trouver un assureur qui acceptera de vous protéger à bon prix!