Are the insurance period and the validity period of the insurance contract the same thing?

What is the term of insurance

This means a certain period of time when the corresponding legal relations exist between the counterparties and when they bear obligations to each other established by the agreement, the Rules, and the law.

Some provisions are contained in:

Chapter 48 of the Civil Code;
Law 4015-1 of November 27, 1992 “On the organization...” (hereinafter referred to as Law 4015).

How to renew your insurance

When the insurance period has expired, it should be renewed immediately. If the driver wants to continue cooperating with the company from which he already purchased MTPL, it will be renewed automatically, but he will need to notify the insurer orally: by phone or in person. Of course, you need to pay for a new car license.

When a person wants to choose another company, he should come to the office of the new insurer and write an application. To issue a new policy you will need the following documents:

previous insurance;
passport;
identification documents of who will drive the car;
document confirming passing the technical inspection;
registration certificate.

It is also necessary to pay OSAGO according to the new details.

Insurance period and contract term

The policyholder, another person directly or indirectly participating in the relevant legal relations, should differentiate the meaning of the concepts “Insurance Period”, “Contract Validity Period”.

The validity period of an insurance contract is understood as the period of time during which the obligations assumed by each party to each other are valid. Simply put, the policyholder, the insurer, within a specified period of time, is obliged to fulfill everything that is regulated by law, contract, Rules, and after the expiration of the presented interval, they may no longer fulfill it. For example, the policyholder is obliged to notify the insurance company of an increase in the insurance risk from the first second of the contract’s validity (Part 1, Article 959 of the Civil Code).

The insurance period is considered to be the period of time during which the insurance is valid as such. That is, the insurer is obliged to pay compensation only if the insured event occurs during the insurance period, not during the validity period of the contract.

Attention! The insurance period cannot last longer than the duration of the insurance contract (it can be shorter).

How to draw up a life insurance contract

To sign up for a life insurance contract, you must select an insurance company and an insurance program. This must be done very responsibly, since a very long-term cooperation is expected, which means that the company must have a stable position in the market and a good business reputation.

To sign the contract, it is enough to provide:

passport of a citizen of the Russian Federation or a citizen of a foreign state;
application form for insurance.

Additionally they may request:

employment certificate or tax return;
medical examination report;
special questionnaires on the pathology/disease stated in the questionnaire;
protocol of the operation (if there was one);
discharge summary at the place of receipt of medical care;
results of endoscopic, electrophysiological research methods, ultrasound, tomography, x-rays, 24-hour blood pressure monitoring and ECG.

The policyholder is obliged to inform the insurer in a questionnaire application of the circumstances that are significant for determining the likelihood of the occurrence of an insured event and the amount of possible losses from its occurrence, and also provide, upon his request, certificates of health.

A life insurance contract is always drawn up in writing after all the documents have been reviewed and the insurer is ready to sign it.

Example of calculating the insurance period

Let's look at how the insurance period is calculated using simple examples.

Example No. 1. Let the policyholder enter into a property insurance contract. The said agreement did not change the dispositive norms specified by stat. 957 of the Civil Code.

Let the contract be concluded on June 1, 2021 at 0:00, for 12 months. The policyholder paid the insurance premium the next day - June 2, 2021, 12:00. It is from this moment that the validity of the contract is calculated (12 months), and the counterparties bear mutual obligations under it. Immediately after the payment of the insurance premium, the insurance took effect - that is, on June 2 at 12:00. This means that if an insured event occurs from June 2, 2021, 12:00 until June 2, 2021, 11:59, it is possible to claim insurance compensation.

Example No. 2. Let’s take the data from the previous example and imagine that the insurance company has changed its mandatory rules:

the contract comes into effect from the moment of conclusion;
the insurance begins to be valid 3 days after the contract comes into force.

This means that the mutual obligations of the parties under the agreement will begin on June 1, 2021 from 0:00. From this moment the contract will come into force (12 months will begin to count). It is possible to receive compensation only for insured events that occurred on June 4, 2021 from 0:00 – May 31, 2021 until 23:59.

What is life insurance

Life insurance is one of the most common types of endowment life insurance. It is offered in the Russian Federation by approximately 20 insurance companies (for example, Alliance-Life, Uralsib-Life, AlfaStrakhovanie-Life, Capital-Life, etc.).

Its essence is as follows:

The insured pays insurance premiums to the insurer for a certain period of time (from 1 year to 25-40 years).
The insurer forms insurance reserves from them and invests the money in various investment instruments (deposits, securities, real estate, etc.).
At the end of the insurance contract (survival until a certain date), the capital is paid out along with the investment income received.

Typically, such programs are combined, and, in addition to the risk of survival, they also provide for the risk of sudden death of the insured from an accident, road accident or illness, and sometimes disability, loss of ability to work.

The insured amounts for these two main risks (death and survival) may be equal or different, and will be higher, the higher the premium. As a result, survival policies provide double protection: savings from inflation and possible devaluation, and additionally – the client’s life. Such insurance is an ideal solution for borrowers, as well as business people on whom relatives depend financially.

Is it possible to change the deadline

Counterparties of insurance legal relations have the right to agree on changing the duration of the contract - shorter or longer, by concluding an additional agreement (Article 452 of the Civil Code). If any of the counterparties does not agree to change, nothing can be done.

The insurance period does not have retroactive effect. The right to compensation is lost when the insured event occurs before or after the insurance commencement date - regardless of the contract validity dates.

Important! It is legally possible to change the period of insurance in order to receive compensation for an earlier or later insured event (Part 2, Article 425 of the Civil Code), but then the whole point of insurance as such is lost (and it is unlikely that any insurer will do this).

How to calculate the cost by policy term

There is a special formula that allows you to determine the cost of the policy. To calculate, take the insurance period and multiply by the coefficient:

Duration (months)	Coefficient
3	0,5
4	0,6
5	0,65
6	0,7
7	0,8
8	0,9
9	0,95
10-11	1

It is impossible to issue a document for 2 months or for an even shorter period. This feature only works for transit vehicles.

The price for insurance for a year corresponds to the figures specified in the policy. If insurance becomes more expensive, the cost of a previously obtained policy will remain the same.

Term of insurance in OSAGO

The above applies to cases of voluntary insurance. With compulsory insurance, the minimum and maximum validity periods of insurance contracts and the insurance period are determined by the relevant federal laws (clause “g”, part 4, article 3 of Law 4015). Regarding compulsory motor liability insurance – Federal Law No. 40 of April 25, 2002 “On Mandatory...” (hereinafter referred to as Law No. 40). Frequently 1 stat. 10 of Law No. 40 regulates that an “automobile” insurance policy is always issued for 12 months, except in some cases.

MTPL also differentiates the concepts of “Contract Validity Period” and “Insurance Period”. In a standard situation, the legal relationship between the parties lasts all these 12 months. The period is set by stat. 16 of Law No. 40, which can be 3, 4, 5, 6, 7, 8, 9, 10, 11 months during the specified year.

Minimum allowed period

The minimum MTPL validity interval for insurers insuring cars registered abroad and temporarily used in Russia is 5 days (Part 2, Article 10 of Law No. 40).

Attention! When a policy is needed to get to the place of inspection or to the traffic police department in order to register a car after its purchase, it is possible to buy compulsory motor liability insurance for a period not exceeding 20 days (Part 3, Article 10 of Law No. 40). The minimum period is not limited by law (it seems that it is possible to do compulsory motor liability insurance even for an hour).

Is it worth saving by term insurance?

When a citizen drives a car only during certain months of the year (for example, only in the summer), it is possible to conclude a contract with a condition for seasonal use.

When concluding a contract, specific months are indicated. Let, for example, March, April, May, June, July, August. Total – 6.

There are features:

the contract is also drawn up for 1 year;
You need to pay less for the policy, of course, because a reduction factor is used (see table below);
The obligation for civil liability insurance is considered fulfilled during the validity of the contract (12 months), and not the insurance period, that is, to attract privately. 2 stat. 12.37. Code of Administrative Offences, they will not be able to impose a fine of 800 rubles;
if you drive a car in those months that were not specified, you will be attracted more often. 1 stat. 12.37. Code of Administrative Offenses – fine 500 rubles;
the most important thing is that if you drive a car in the wrong months, the insurer will pay compensation to the victim in the event of an insured event, then through the court it will recover all losses from the tortfeasor (clause “e”, part 1, article 14 of Law No. 40).

As you can see, insuring in this way is not very profitable due to fines, possible recourse, and the fact that the KS coefficient does not reduce the insurance premium too much (for example, you can use a car for only 3 months a year, and the premium will only decrease by half, and not 4 times).

So, the legislation provides for the concepts “Validity of the insurance contract”, “Insurance period”, which you need to know and understand. If the insurance period is not agreed upon, the contract may be invalidated. Read the following article about this procedure.

Minimum period of compulsory motor liability insurance for delivery for registration

In order to register a car with the state, you must have a valid MTPL policy. Usually, an insurance contract for a period of up to one year is required immediately.

But depending on the circumstances, the car owner can choose the type of insurance that is most convenient for him. The minimum contract period in order to register a car must be three months.

The policy itself will be issued for a year, but it can be valid for only three or six months at the request of the car owner. With this form of insurance, the policy is paid at only forty percent of the annual cost.

When you take out transit insurance with a validity period of up to twenty days, you will not be able to register the car with the traffic police, since it is only for transportation. And for accounting you will have to purchase a separate policy for a year.

Car owners must understand that the established term of the contract and its validity period within the framework of the law are two completely different concepts.

An MTPL policy is almost always issued for a year, but how long it will be valid depends on the car owner.

Moreover, the legislation of the Russian Federation does not make any special distinction between private individuals and legal entities. Almost the same legal norms are provided for legal entities.

Read about the refusal to accept documents for compulsory motor liability insurance in the article: problems of compulsory motor liability insurance. Regression under compulsory motor liability insurance is discussed here.

About technical inspection for compulsory motor third party liability insurance (MTPL) is described at this link.

When can you drive without insurance?

Traveling in a car with an expired or no compulsory motor liability insurance policy is considered illegal and is strictly prohibited throughout Russia. But Federal Law No. 40 provides for a number of cases when driving without insurance coverage for a certain period of time is allowed. The number of such situations is strictly limited:

The car was purchased recently.
Temporary numbers have been established for transporting cars in transit (valid only for legal entities).
The driver is a foreign citizen, and his vehicle is insured under an international program.

When purchasing a new car or a used one, the state provides the owner with 10 days to issue a compulsory motor liability insurance policy and register with the traffic police. Evidence of recent purchase may include:

purchase and sale agreement with the seller;
deed of gift;
a will transferring a car by inheritance.

When stopping, it is enough to present these documents along with the papers on the car.

Today, there are many cases when a purchased car is driven to another region after purchase. For this purpose, you can apply for a separate MTPL. It is valid only for 20 days from the time of purchase. During this time, you need to have time to buy full insurance and register the car.

You are allowed to travel for one day in order to visit the office of an insurance company and conclude a new contract under MTPL. If the policy is at the stage of preparation for issue, then to confirm this fact you need to have the appropriate certificate.

The car is insured under the “Green Card” when a foreign car owner enters the territory of Russia. This policy is valid in many countries. The card can be obtained or extended in the country where the car is registered, for a period from 5 days to a year. If the international insurance has expired on the territory of the Russian Federation, then the driver must issue a Russian-style motor vehicle license. If a foreigner does not intend to return home and live in our country for some time, then driving without compulsory motor insurance will be illegal.

What happens if you get into an accident with an expired policy?

If the car is involved in an accident and the OSAGO policy is expired, then its owner cannot escape the fine, which is 800 rubles. This is not much, but it is better to take out insurance in a timely manner, because there is a risk that the owner will be the culprit of the accident. Then he will have to not only pay a fine, but also compensate the loss to the other driver. If an accident occurs involving a car without a compulsory motor liability insurance policy, as a rule, events develop as follows:

The traffic police officer records in the protocol that one of the drivers does not have a compulsory motor liability insurance policy;
the car owner who has overdue insurance is issued a fine;
if the culprit of the accident is the second driver, then further events develop according to the standard pattern and the injured party receives a payment from the insurance company;
If the driver who does not have a policy is to blame for the accident, then the second participant in the incident sends the damaged car for an independent examination. Both parties must be present at the examination;
Based on the examination, the amount that the culprit of the accident must pay to the injured party voluntarily or by court decision is determined.

Since you will have to pay for the repair of the second car out of your own pocket, it is better to renew your MTPL policy in time and get rid of possible problems.

Let's sum it up

As is clear from the information above, the duration of the contract depends on the category of the car (registered in another country, transit or registered in Russia), as well as on the desire of the car owner to conclude a contract for a convenient period of time . The period of use of the MTPL policy can be from three to eleven months or a whole year. Depending on the number of months, one or another coefficient is used to calculate the cost of insurance.
The policy becomes void immediately upon expiration and there are no additional grace periods. Post Views: 7,544

How to extend the MTPL period?

Everything is quite simple here. That is, the MTPL insurance contract is usually concluded for a period of one year. In this case, the annual cost is a constant value.

The minimum period of MTPL insurance is three months. For such a period, those citizens who intend to soon sell their own vehicle usually enter into an agreement. However, for these 90 days the policyholder will need to pay half the annual cost of the policy.

If there is a need, a citizen can easily come to the organization any day and renew the MTPL until the end of the policy year.

Having paid 0.7% of the annual policy in the first half of the year, the car owner will need to make an additional payment of 0.3% of the annual insurance amount for the remaining six months.

How to save on insurance?

According to the rules of the insurance policy, payment for voluntary insurance in installments is not provided.

However, this does not at all prevent a citizen from taking out a policy for three months, paying 0.5% of the annual insurance, then extending it by paying 0.2%, and then he can extend the insurance a third time by paying the balance of the required amount, which, in principle, is an installment plan. This method of paying for a policy can be said to be quite profitable, given the crisis period.

But, the renewal of the contract must be carried out in advance. Indeed, otherwise the company will have the right to charge the same percentage as for the first three months.

Driving a car at a time that is not covered by insurance entails liability in the form of a fine of 300 rubles. After paying such a fine, there is no need to take further risks.

That is, if a traffic accident occurs during this period, which is not covered by the policy, the company will compensate the losses of the injured party. However, in this case, the citizen will be sent a demand by the insurance company to compensate for the losses that it had to suffer.

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What is the difference between the contract period and the period of use?

The validity period of the insurance contract and the period of use of the car are different concepts, although they refer to the same contract. The validity period is the period of time for which an agreement is concluded between the motorist and the insurance company. According to current Russian legislation, it is exactly one year. At the end of this period, the policy can be renewed. The validity period is also called the insurance period and is indicated at the top of the policy.

The period of use is indicated in the line following the validity period of the agreement. It can be either standard (12 months) or less than the period for which the agreement was concluded. This is true in cases where the car owner does not plan to use the car throughout the year, plans to sell it soon, or only hits the roads when it gets warmer. Watch the video about the differences between terms and validity periods.

The period of use cannot be longer than the period of validity of the contract, but may be shorter. In this case, the amount that must be paid to the insurance company will be less. The column where the period of use is marked indicates how long during the entire term of the agreement the car owner can use the car. Moreover, the driver has the right to choose specific months when the insurance will be active. This can be one season, or one month each of summer, autumn and winter.
It all depends on how often the car is used. Important : despite the fact that the policy is valid for a year after its receipt, if the period of use has expired, you cannot drive a car with such a document. The policy will be considered expired and the driver will have to pay a fine. If the policy is issued for specific months, for example, June, July and September, then it is not valid in August.