New rules for payment of insurance premiums

Question: Am I going to have less time to pay my insurance policies? Previously, I had 30 days after the policy renewal date.

Answer: No. The Decree-Law Nº122/2005 of July 29 stipulates that insurance companies must send you the payment notice no later than 60 days before the payment date of your policy (renewal date).

Question: What will happen if I do not pay my premium by the date referred on the payment notice?

Answer: Your insurance policy will be cancelled on the date indicated as the respective last payment date. In order to enable you to have cover again, you must start a new insurance policy.

Question: Does this mean I will not owe anything?

Answer: Yes. As the insurance policy will not be in effect – since the premium has not been paid – you will owe us, or the insurance company, nothing.

Question: What are the consequences if I do not pay my motor insurance policy?

Answer: If you do not pay your motor insurance policy, the Direcção Geral de Viação (DGV), the general road transportation department, will be aware of the situation as insurance companies are legally obliged to provide the DGV with vehicle registration numbers and the clients’ names and addresses for all insurance contracts, whether these are renewed, new or cancelled. The DGV will then pass on this information to the police authorities and vehicles without valid Civil Liability Insurance will be clamped or towed away, or their owners will be fined and their vehicles apprehended.

Question: Is this new insurance premium payment system also applicable to the insurance policies I have for my house, vehicle, health, domestic servant, boat and company premises?

Answer: Yes. This situation is exactly the same. The new insurance premium payment is also applicable to these cases.

Medal Lda will send out payment notices to their clients at least 30 days before the renewal date of each insurance policy. The company warns that this is dependant on when the insurance companies send the policy documents and receipts for them to check.

Medal Lda is hoping to have a direct debit system available by the end of March 2006, in order to enable clients to have another way to pay their insurance premiums.

Medal Lda is available to answer any questions you may have. The company is located at R. Dr. Teófilo Braga 3-A, 1º A/B in Portimão. Tel 282 430 800, Fax 282 430 809, e-mail info@medal.pt or visit www.medal.pt