Insurance experience letter 2023 (guide + free example)

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This post covers everything you need to know about the Insurance experience letter.

No one likes high premium rates when it comes to car insurance.

But the good news is through an Insurance experience letter you can reduce your premium by more than 50%.

Can you just imagine a single document takes your monthly premium from $300 to $150 within seconds?

That is a shot up from a 0 to 9-star driver.

Purely MAGIC.

And this post is all about how you can explore that magic through a wand called an Insurance experience letter.

Here I will take you through

  • What is an Insurance experience letter?
  • How can you obtain an Insurance experience letter from your previous insurer?
  • How does an Insurance experience letter work?
  • Why do you need an Insurance experience letter?
  • When is an Insurance experience letter necessary?
  • What does an Insurance experience letter contain?
  • Insurance experience letter example
  • Can an Insurance experience letter really help you get a premium discount?
  • What if your Insurance experience letter does not help you to get a discount?
  • etc.

Let’s get started

What is an insurance experience letter?

An insurance experience letter is a brief statement of facts written by a former or present insurance company to provide a verified record of a driver’s insured history.

An insurance experience letter is also known as an Insurance Letter of Claims Experience or Proof of Prior Insurance Letter.

This letter is always provided by an insurance company upon the request of a policyholder.

For example, you want to change insurance providers or you have moved from one country to another (let’s say from Canada to the USA) and you have successfully found a new suitable insurance company for your car.

In that scenario, before taking you on board, your new company may ask for an insurance experience letter to verify your records, and to have one, you will be required to request it from your former insurance provider.

How can you obtain an Insurance experience letter?

The procedure for obtaining an Insurance experience letter from your previous insurer is very simple and straightforward.

And most of the time it is free of charge.

All you have to do is ask your insurance company for an experience letter through a formal request letter, email, or call.

Talk to your company to figure out what their appropriate request means.

Tell them why you want the letter- you have moved out of the country, your new insurer needs to prove claims on your record, you have been covered by someone’s else insurance and now you own your car, etc.

Give as many details as possible when you request an experience letter from your previous insurer.

This will help them come up with an experience letter that will effectively meet your demand.

REMEMBER Only the insurer who issued you a policy can supply you with a letter of experience.

I advise you to request an insurance letter of experience whenever you switch providers.

This will ensure that you always have an up-to-date insurance record and will save you the time and trouble of requesting one in the future.

DON’T WORRY even if you haven’t had insurance in a while, you should be able to request a Letter of Experience from your previous insurer.

How does an Insurance experience letter work?

An Insurance experience letter works as a letter of recommendation from your previous insurance company.

It gives your potential insurer vital information about your insurance history.

An Insurance experience letter is your former insurer’s mode of vouching for you to new insurance providers.

It is essentially a method for moving your verified insurance record between insurers.

Why do you need an Insurance experience letter?

As I explained from the outset of this post, I don’t believe I need to use much energy to explain why you need an insurance experience letter.

You already know!

Insurance companies frequently require a letter of experience to verify and update your coverage information.

Therefore, a letter of experience showing a strong history of coverage may qualify you for insurance discounts.

This is especially true if you have few or no claims.

It might also assist you in obtaining insurance if you are having difficulty finding someone willing to insure you.

NB: An insurance experience letter is not a mandatory requirement but is one of the components that an insurance company may consider when calculating your insurance premiums.

When do you need an Insurance experience letter?

When switching from one domestic insurer to another, the majority of American insurance companies do not demand a Letter of Experience.

Here is why

American insurance companies have shared Comprehensive Loss Underwriting Exchange (CLUE) databases that compile all insurance data in a single handy spot.

CLUE keeps track of information about drivers and automobiles.

Insurance companies can quickly examine your driving record and accident history through this database

But you may still need an Insurance experience letter if;

  1. You have moved to the USA from another country
  2. You need to prove claims on your record
  3. For whatever reason, you haven’t had an insurance policy in several years.
  4. Your new insurance company needs clarification on your insurance history,
  5. Despite having insurance, you weren’t the primary insured under your previous insured policy, for example, you had insurance coverage through a parent, spouse, or roommate, or were covered by any other unique situation)
  6. etc.

What does an Insurance experience letter contain?

Generally, The format of a Letter of Experience may differ from company to company, but it must contain all pertinent information about the driver and their insurance history including;

  • Your personal details (name, address, and contact information)
  • The personal details of other individuals covered by the same policy
  • The policy number
  • The details of the insured object eg. vehicle SN and other description
  • the start and end dates of the policy.
  • All insurance claims
  • claims-free status. The Letter of Experience may declare, for example, that “no claims were paid during this period,” this may help you qualify for a claims-free rate with your new insurer.
  • Claims for additional drivers on the policy. If you had a clean driving record but your son wrecked a vehicle while covered by your policy, your son may be included on the Letter of Experience.
  • Reasons for any insurance cancellations

Insurance experience letter example

The following is a simple sample of an Insurance experience letter from an insurance company.

COMPANY LETTERHEAD

DATE

Recipient’s Name
Title
Company Name
Street Adress
City, State, Zip code

Dear Mr./Mrs./Ms. [Recipient’s Last Name]

This is to certify that Mr. Very Good of [address] has been insured by our company under [name of policy] policy number [policy number] from [policy start date] to [policy end date].

During our coverage term, there have been no claims filed, no reported accidents, and no criminal charges against Mr. Very Good.

We understand that Mr. Very Good is now looking for another affordable insurance company that will meet his financial expectations. We strongly believe that this letter offers significant information that will help you make a reasoned decision.

If you have any questions regarding this letter or require further information concerning Mr. Very Good insurance experience with us, feel free to contact us through [email] or [phone]. We will be thrilled to discuss with you Mr. Very Good coverage history.

Sincerely

Signature

Name
Title
Company Name

Can an Insurance experience letter really help you get a premium discount?

Yes, an Insurance experience letter can really help you get a premium discount and it may do that for more than 50%.

That means by proving that you are a reliable individual it may take your premium monthly fee from $400 to $200.

In case you don’t believe my words (they are too simple to be true) the following real-life examples may make more sense.

First, we have hesh0925 (Reddit username)

In his post, Hesh witnessed that with a simple letter of experience her wife was able to shoot up from a 0-star rating to a 9-star driver and reduced their premium drastically from $340 a month to $180 a month.

How an experience letter helped us save almost 50 on car insurance
A screenshot from hesh0925 Reddit

Here is an embedded full post

Another one is snirpvill

In his post snirpvill said through an experience letter from his car insurance company and a driving record from his former province (needed when he moved to Manitoba) he got a nice discount on his monthly insurance, however, he did not say how much but at least he got a discount.

Here is an embedded full post

If it worked for others, it will also 100% works for you.

The bad news?

That result is not guaranteed.

What if an Insurance experience letter did not help?

Sometimes even a strong Insurance experience letter may not help you get a premium discount.

Here is why

Because each insurance company has its own pricing system, your letter of experience may or may not result in the savings you were hoping for.

Although your letter may indicate 24 months of excellent standing, your new insurance carrier may have a system that offers a claims-free discount only after three years.

In this situation, regardless of your experience letter, you’ll still have to wait a year to earn the discount.

Insurance company prices can be influenced by a variety of things.

Subtle differences in pricing can have a significant impact.

It is best to compare insurers to find the best plan and price for you.

You really need to do your homework here.

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Isack Kimaro
Isack Kimaro

Holder of Bachelor of Laws (LL.B) and Post Graduate Diploma in Legal Practice. I am dedicated to providing valuable and easy-to-understand legal information for individuals at all levels of understanding. Whether you are a layperson looking to increase your knowledge, a law student striving to excel in your studies, or a practicing lawyer wanting to expand your expertise, I am here to help. I'm not creating content, I'm creating awareness to empower you to take control of your legal understanding and achieve your goals.