Do you want to clear your doubts about pirate insurance? So you are in the right place. In today’s article, I will explain everything you need to know to avoid problems.
According to data released by Fenacor (National Federation of Private Insurance and Reinsurance, Capitalization, Private Pension, and Insurance and Reinsurance Brokers), pirated insurance moves (annually) between R$ 7.1 billion and R$9.4 billion in Brazil.
While lucrative, this type of vehicle protection is dangerous for car owners. But what is pirate insurance? How do identify it? What to do when you are a victim of it? Find out the answer in the next topics!
What is pirate insurance?
Pirate insurance promises all protections and rights to the insured in the event of claims – just a promise. In fact, this type of insurance is marketed by companies with CNPJ, but without authorization from SUSEP (Superintendence of Private Insurance). This entity is responsible for supervising and controlling the insurance market.
Still without insurance for your car?
In general, companies that offer pirated insurance are associations or cooperatives. Unlike insurance brokers, they do not issue a policy, but a proposal for membership upon payment of the membership fee.
As for the value of monthly fees, they can cost up to 3 times less than a policy. In addition, it varies according to the number of associates and claims incurred. Although it seems advantageous for the pocket, it is not so good when the insurance is triggered, since there are many restrictions to obtaining the coverage.
Furthermore, the insured discovers that much of the damage to the car will not be repaired. In this way, the vehicle owner leaves at the loss and with a feeling of frustration.
Justice reaction
In September 2015, an operation carried out by the Federal Police closed three companies that sold protection for cars and motorcycles in Pernambuco.
More than 7,000 customers were at the base of these organizations, which did not have legal authorization or certification from SUSEP to sell insurance.
In December of the same year, the Federal Public Ministry obtained an injunction to suspend two other companies in the state.
How to identify and avoid pirated insurance
In order not to fall into the trap of pirated insurance, it is important to pay attention to some details before signing a contract. Which ones are they? Check it out below.
Check if the company is authorized by SUSEP
It is worth mentioning that in order to sell insurance, the company must be authorized by SUSEP. Therefore, the vehicle owner should make a query on the institution’s website to ensure that the company has this official registration.
Be wary of very different values
Something that makes the cost of pirated insurance to be lower than that of insurance companies in the absence of a reserve fund. For insurers, this fund is mandatory and guarantees that policyholders will have compensation when they need it.
On the other hand, associations or cooperatives depend on the payment of members to cover the costs of claims. In case of default, the owner can stay in hand. Therefore, be wary of very low values in relation to the insurance market. It is possible that you are facing pirated insurance.
Understand how risk assessment is done for insurance
Before setting the value of the policy, insurers evaluate a number of factors regarding the car and the owner. After all, it is a risk they are taking. Pirate insurance does not carry out this type of assessment, as it stipulates the amount of protection based on the price of the car in the FIPE table.
So, if there is no prior evaluation of the vehicle, be suspicious. Even more so if in place of the nomenclature “insurance policy” there is something like “vehicle protection” or “benefits club”.
Search and report
When you come across an insurance offer from vehicle protection associations or cooperatives, or even if you have doubts about the origin of the company, visit the SUSEP page. There, there is a specific area to search for the entity’s name and check if it has the superintendence’s approval.
If you can’t find the company on the website, give up on the business and file a complaint through SUSEP ‘s Contact Us. Thus, you help the market and still collaborate so that future consumer is not deceived.
Hire those who have authorization. Always look for a broker or an insurance broker who will guide you on how to hire real insurance that really protects your assets.
Clarifications of the difference between Vehicle Protection x Auto Insurance
To make the difference between vehicle protection (pirate insurance) and auto insurance clear, we show the characteristics of each one of them.
vehicle protection Car insurance
The risk is not transferred to the company, but to the associates. The insurer assumes the risks incurred with the vehicle
There is no reserve fund There is a mandatory reserve fund required by legislation
Anyway, car insurance is essential protection for car owners. Since it guarantees the security of a very precious asset. To avoid surprises at the time of an accident, avoid pirate insurance. That way, you won’t have a headache, but tranquility to circulate with the vehicle.
Avoid unforeseen events: quote your insurance
Did you understand what is pirated insurance? More than protecting your car with maintenance and revisions, taking out Geico auto insurance is essential to ensure that it is covered in the most diverse situations.
