What is a letter of experience for Auto Insurance?

What exactly is a letter of experience for Auto Insurance?

It’s a document provided by your previous insurance company to validate the details you’ve supplied regarding your driving and insurance track record.

Your new car insurance provider might request it, or you can obtain it from your former insurer to streamline the process of obtaining multiple insurance quotes.

An image illustration of What is a letter of experience in Auto Insurance
What is a letter of experience in Auto Insurance
Source: (thinkinsure)

Who should request this letter?

A letter of experience serves as a useful tool for insurance verification in the following scenarios:

  1. If you’ve been insured before, but you weren’t the primary policyholder, like when you shared a policy with a roommate or were included on your parents’ policy.
  2. When an insurance company requests it to rectify or update their records, such as correcting an erroneous designation of you as the ‘at-fault’ driver in an accident. A letter of experience allows them to update their records accurately.
  3. Naturally, individuals seeking to change insurance providers can always request one if they wish to utilize an experience letter while collecting quotes from different insurers.

hat details are typically found in the letter?

A letter of experience typically encompasses the following information:

  1. Description of the insured item, such as a vehicle or a residence.
  2. Names of individuals listed on the insurance policy, typically the registered owner of the property or the vehicle. It may also include the names of other insured drivers.
  3. Commencement and termination dates of the insurance coverage.
  4. Policy number for reference.
  5. Comprehensive information about any filed claims during the coverage period, including details about the nature of the claims, the amounts paid, and their causes.
  6. Explanation regarding the reason for policy termination, whether it was due to non-payment or outstanding insurance premium payments

How a letter of experience can be beneficial

Insurance providers often perceive individuals obtaining insurance for the first time as higher risk.

Possessing a letter of experience and being able to furnish it offers a straightforward means to demonstrate your previous insurance history.

Furthermore, you may potentially qualify for a discount, although it is not consistently guaranteed.

The availability of a discount, or the extent of the discount itself, varies depending on the specific car insurance company.

For instance, your letter of experience might indicate two years of accident-free coverage.

Some insurers may only offer a claims-free discount after three years of proof.

An image illustration of Letter of experience for Auto Insurance
Letter of experience for Auto Insurance
Source: (cover)

Is a letter of experience mandatory for all insurers?

Insurance providers do not mandate the submission of a letter of experience.

However, it’s a good practice to inquire with your insurer whether providing a letter detailing your claims history or insurance background could potentially impact your policy’s pricing.

How to initiate a letter of experience request The process is quite straightforward.

You can easily request a letter of experience by contacting your insurance agent.

Even if you haven’t held insurance for an extended period, you can reach out to your previous insurer and request one.

Transitioning to Different Insurers

Maintaining current copies of your letter of experience can prove advantageous for future endeavors.

Whether you’re seeking insurance quotes or contemplating a switch to a new insurance provider.

While discounts are not guaranteed, the letter of experience provides evidence of your policyholder history.

Potentially leading to premium savings with your next insurer.

If you’re still in the process of exploring better insurance rates, the Cover app can simplify the task for you.

We meticulously scan over 30 insurance companies to secure the most favorable rate on your behalf.

Frequently asked questions

  • What is insurance experience?
  • What does an insurance reference letter involve?
  • How does the experience factor influence insurance?
  • How do I craft an insurance statement letter?

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