Understanding Your Policy: Cancellations and AgShort Rate Explained
At VT Insurance Agency, we understand that flexibility is key. Whether you’re looking for drone insurance or aviation insurance, we’re here to provide comprehensive coverage with options that suit your needs. In this blog, we’ll explore the cancellation process and the AgShort Rate, helping you navigate these important aspects of your policy.
Cancellation Process
- Notify your agent or VT Insurance Agency directly: Contacting your agent or our team is the first step to initiating the cancellation process. We’ll guide you through the necessary steps and ensure proper documentation is completed.
- Review your policy terms: Each policy has specific cancellation provisions, including notice periods and potential fees. Carefully review your policy details to understand the specific requirements for your cancellation.
- Sign a Loss Policy Release Form: The LPR is the official confirmation from the insured that they would like to cancel their policy and the reason for doing so. Underwriters will need this before cancelling your policy.
- Receive your refund (if applicable): Depending on the timing of your cancellation and policy terms, you may be eligible for a premium refund. We’ll calculate and issue your refund promptly.
Understanding the AgShort Rate
The AgShort Rate is a crucial factor to consider when cancelling your policy. It refers to the percentage of premium that is fully earned within a specific time period within the policy if a cancellation were to occur.
Here’s how the AgShort Rate works
- Calculating the AgShort Rate: Every company is different but the majority of companies apply it within a 120 day window with 30 day intervals. After each 30 day interval, a specified percentage of premium is fully earned.
- Impact on refunds: The AgShort Rate can apply to all or some of your policy premium. Be sure to read your policy or talk to your VT Insurance agent about what coverages apply to the AgShort rate calculation on your policy.
- Transparency and communication: At VT Insurance Agency, we believe in transparency. We’ll clearly explain the AgShort Rate and its impact on your cancellation, ensuring you understand all aspects of the process.
Why do insurance companies apply the AgShort Rate
The AgShort rate has been a major part of aerial application policies for many decades. The underwriters understand that aerial application insurance is a seasonal coverage and the risk for these policies is only within a short window of time. All insurance companies base their annual rates off of their annual loss ratios. This only make since for aerial application if the companies can earn the majority of their annual premium from their insureds.
VT Insurance Agency: Your Reliable Partner
We at VT Insurance Agency are committed to providing you with exceptional service and clear communication regarding your policy. Should you have any questions about cancellations, the AgShort Rate, or any other aspect of your drone or aviation insurance, please don’t hesitate to contact us.