Duncan MacBeth makes some good points in his letter (Letters, 5 January). 'Days of grace' and the motor equivalent had a purpose when the post and cheques were the recognised methods of premium payment. In modern times with 24/7 banking, credit cards and installment premiums, grace periods no longer have a useful purpose.

If I don't pay my gym subscription on time, I don't get in until it's paid. There is no grace period. If the intention is to sell insurance like other commodities, our contracts should be the same. In particular, I find there is much confusion about the Road Traffic Act (RTA) grace period, peculiar to motor insurance.

Is it generally known the RTA grace period is conditional on the policyholder genuinely intending to renew? If the policyholder or intermediary continues to look for alternative quotes after renewal, he loses his entitlement to the contractual aspect of this RTA cover.

Clearly, very few of us in the business take the trouble to read the documentation that goes out. It's a pity that the industry has taken so long to recognise this anachronism and more of a pity that the insurers cannot act together.

It is unthinkable that there may be some insurers retaining the period while others do not and, among those who do retain it, the grace period lengths vary.

Insurers should invite renewal this year with the RTA grace period as normal, but include a strong message to the effect that by the next renewal the expiry date of the policy will mean just that.

Roy Rodger
Insurance Training and Consultancy