What does “tacit renewal” mean?

The tacit renewal implies that unless otherwise advised by you the contract will be renewed automatically.

What is a tacitly renewable contract?

A tacitly renewable contract is a contract that is automatically renewed for a period of one year after its expiry. In other words, it is not necessary for the contracting parties to express their wish to renew it.
Very often in the field of insurance, fixed-term contracts include an automatic renewal clause. Renewal of the contract may be provided for in the interests of the parties to the contract.

Can tacit renewal be opposed?

The Chatel Law (Law n°2005-67 of 28 January 2005) reinforces the protection of policyholders by imposing an information obligation on the insurer. It also sets strict deadlines for the procedure. Opposition by the insured to the tacit renewal of his contract must be made by registered letter.
The possibility of not renewing must be clearly stated at least fifteen days before the deadline for cancelling your contract.

How does the Loi Chatel work?

The Chatel law offers new possibilities for cancelling. There are 3 possible scenarios:

  • the insurer respects its obligation and you receive the letter informing you of the possibility of cancelling within the legal deadline, i.e. 15 days before the end of the notice period. You can terminate your contract before the end of the notice period, after which you will be subject to automatic renewal.
  • you receive the expiry notice only a few days before the end of the notice period. You then have 20 days from the date of dispatch of the notice to cancel the contract.
  • the insurer does not respect the rule, does not send any letter or does not comply with the legal deadlines. You can terminate the contract at any time by registered letter with acknowledgement of receipt. If you have already paid your premium, the insurer must reimburse you for the excess amount.

However, you should know that the Chatel law is only valid for tacitly renewable contracts which only concern natural persons outside their professional activities, and that it does not apply to life insurance or death insurance, nor to group contracts. Finally, don’t forget that after cancelling, it is important to find a new health insurance policy to stay covered.

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