Shopping for car insurance can be stressful because there’s a lot of paperwork involved, you want to get quotes from multiple companies, and you never really know what kind of premium you’ll be eligible for until you get your quote back. A letter of experience for insurance will help you get those quotes back faster. Today, we’re going to tell you what this is and why it’s a good idea to have one.
What the letter actually is and when you might need one
When you apply for a new job, the company asks for references to check your character, work ethic, and overall employment history. A letter of experience for insurance is like a work reference letter that pertains to your policy history alone.
If you’re shopping around (and you should be!), potential insurance companies may request such a letter to get an idea of your previous insurance and claims history and to help assess your risk as a potential client.
You’ll want to provide one if you check any of these boxes:
- Have recently moved to a new province or country.
- Weren’t the primary insured person on a previous policy.
- Were uninsured for a period of time.
What information can you expect in your letter of experience?
Individual providers draft letters of experience for insurance, so the information on each one will differ slightly. For instance, your condo insurance provider may not include some of the finer details provided by your vehicle insurance company, but each one will give a record of your insurance history with that company, including information like:
- Your name and address.
- The name of all people insured on the policy.
- Policy number.
- Start and end dates for your policy.
- Policy cancellations.
- Claims made against the policy.
What’s the benefit of having one?
There are many factors that insurers use to determine individual premiums, including your insurance history. Therefore, if you provide a potential house, vehicle, or even a rental insurance provider with a letter of experience for insurance, then you may be eligible for discounts and lower premiums.
For instance, if you were with the same car insurance provider for ten years and had no claims in that time, then you’d likely be eligible for a lower premium than if you had no insurance history.
Obtaining your letter of experience for insurance discounts
You can request a letter of experience directly from your auto or home insurance company. Brokers typically can’t write these letters themselves, but if you’re having trouble getting in touch with an agent at your insurance company, your broker may be able to help.
Insurance companies don’t always require a letter of experience from potential clients, but it’s a good idea to keep updated versions from all the providers you deal with. If you ever do go shopping for a new provider, especially in a new province, then the letter of experience will tell the provider what kind of policyholder you are, and this could result in considerable savings on your premiums.