Limitations of renewal flow types

Bind-and-cancel renewals have one main limitation:

• If the insured fails to pay, no coverage is provided, which can cause ambiguities. Imagine that the date occurs in the period in which the renewal term appears to be bound in PolicyCenter but no payment was received yet. If the insured files a claim today, the insurer must make it clear to the insured that coverage is uncertain. If the insurer receives payment within the deadline, there is coverage. Otherwise, the insurer must deny the claim. This is especially a problem if insurers provide a grace period after the start of the renewal period for receiving payment. In the bind-and-cancel renewal, there is no clear indication in the data model that the renewal period is uncertain.

Renewal offers have two main limitations:

• If PolicyCenter considers the policy issued in PolicyCenter, does that mean that the insurer must implement advanced notification and justification steps to cancel? That might depend on many factors, including jurisdiction, and also the wording to the insured about whether renewal is contingent on payment by a certain date. The fact that no renewal term yet exists because the job is unfinished complicates the question of coverage and billing
• For renewal offers, BillingCenter is not in charge of the invoicing for the renewal offer itself. Some insurers want BillingCenter in charge of the renewal offers, particularly for receiving electronic payments.