Insurance warning

[pauljmcnulty]

I wonder if the insurers have changed their strategy on renewal costs?

Although we all see insurance as a tax, and a license to print money for the companies, in fact motor policies lose money for them on average. The current ease of doing a quick comparison for a better deal is good in the sense it gets us the lowest price, but also carries a risk that they have to hit you somewhere else. That might be on service, perhaps that the reaosn for the problem I had, and Chris has had, with Classicline: someone who's insured my car for 10 years without fault until recently.

I'm sure it's partly a coincidence, but I also suspect that all insurance brokers are struggling to compete with the online comparison sites. What worries me is that you need to rely on the broker in the event of a claim. Fair enough, if you go for the cheapest cover from a major insurer, you appreciate that your 944 is valued at £900 book price, and a small knock means your pride and joy is off to the crusher. We need the specialist brokers though, as they understand agreed values, local specialist repairers etc.

It's a real concern if the multi-national insurers become so cheap they put the specialists out of business. Whilst I understand the need to save money if possible, insuring a specialist car isn't best done through someone like Direct Line or Tesco, unless you accept it's almost third-party cover. The car will be written off in the event of a claim, simple as that.

We also have a collective responsibility to minimise claims. That means not taking the hire car if you don't need it, or any other extras. I was shocked by the level of bullying I got, pressurising me to take every possible extra service, including personal injury, for a small car-park knock. When you understand that the insurer gets a commission from the hire-car company, the legal team, the recovery driver, you see why they push for all the "free" services you can claim, but this all adds masses to the premiums next year.

 

[944Turbo]

I struggle a great deal with insurers claims that compulsory insurances make them no money (car insurance, employers liability etc.) I suspect that they throw the majority ( or all) the costs of the building / staff / computer systems / telephones etc etc. against them on the books to make it look like there is no money made and increasing the profits on the optional insurances.
They are only in it for the money if they were not making any they would be out of it!
Tony

 

[pauljmcnulty]

They are only in it for the money if they were not making any they would be out of it!

I remember from my days in catering that the restaurant industry in the UK makes a net loss. More restaurants lose money than make money, despite it being a huge industry that employs a lot of people. The whole turnaround of restaurants opening and going bust actually makes a load of money for the associated industries, and keeps a lot of people off the dole, so not a bad thing unless you start your own restaurant!

I might be wrong, but there have been claims from all the major insurers that UK private motor insurance is a net-loss market. Some might make a small profit, others consider it part of their overall business and it's a loss-leader, but it's not the cash-cow we see it as.

Fact is, we're seeing so many businesses expanding in to areas they can't possibly all make a profit from. The AA for a plumber, Tesco for your mortgage, it's all about getting you more and more tied to one company for everything, even if some of their products lose them money.

 

[zcacogp]

I think you need to see the 'loss' in the slightly bigger picture; they pay out more than they collect in premiums, but don't make a loss. The insurance industry effectively holds a lot of cash on deposit and invests this cash to make a profit. (In simple terms, they take all your money up front but are statistically unlikely to have to pay it out in a claim until a few months have passed.) If investments go well, they can afford to lower their net premiums; if investments go badly, those premiums go up. This explains why there is such a hike in premiums if you want to pay in instalments.

In many ways the insurance industry is very similar to the banking industry although is much more likely to pay out a given deposit within a given time frame. It is hence closely tied to the investment and other financial markets. To say that it makes a loss is correct from some points of view, but not correct when the whole of the picture is take into account.


Oli. (Consultant to various financial industries for many years, which may explain why I am a cautious bar-steward who never wants to spend money!) []

 

[ChasR]

ORIGINAL: geoff ives

A little advice.
When you renew on the phone/online request that a certificate of insurance is e-mailed to you imeadiately. I usually say that it is required for an event that I have entered.

Some insurance companies refuse to do this, since they said many people will say that the certificate in a home printed form will not be acceptable. My local post office used to get quite funny about this as well until very recently. Thankfully that number seems to be dwindling.

I am similar to Simon in how I check whether my cars are insured or not .

 

[chrisjcoe]

I don't think that insurance checker is free though, perhaps the club could provide this service?

 

[GlennS]

ORIGINAL: chrisjcoe

I don't think that insurance checker is free though, perhaps the club could provide this service?

Checking your own vehicle's insurance status is free

http://ownvehicle.askmid.com/

 

[geoff Ives]

ORIGINAL: ChasR

ORIGINAL: geoff ives

A little advice.
When you renew on the phone/online request that a certificate of insurance is e-mailed to you imeadiately. I usually say that it is required for an event that I have entered.

Some insurance companies refuse to do this, since they said many people will say that the certificate in a home printed form will not be acceptable. My local post office used to get quite funny about this as well until very recently. Thankfully that number seems to be dwindling.

I am similar to Simon in how I check whether my cars are insured or not .

That is why I say I need it for an event... You can't convince them that you need it for road tax if you currently have tax... they can check that.

The bottom line is to ask if the actually want your business.

 

[tscaptain]

ORIGINAL: GlennS

ORIGINAL: chrisjcoe

I don't think that insurance checker is free though, perhaps the club could provide this service?

Checking your own vehicle's insurance status is free

http://ownvehicle.askmid.com/

Curious. I put my other car reg in on the askmid website. Not on the database it said! Odd as the renewal went through on the 8th June. Phoned insurer who said phone DVLA. Phoned DVLA and they said "nothing to do with us, contact MID" You can't contact MID - and certainly if you could they wouldn't change anything on my say-so! FAQ on their website says if the reg doesn't appear on the website I may be pulled over by the boys in blue - contact your insurer! Full circle.
Second call to insurer who said the underwriters are the ones with the power to add details to the MID and why mine hadn't was a mystery. Of course had this thread not appeared the first I would have known about it would have been either when I was pulled over or tried to tax the car.

Moral of the story - you may be insured but that doesn't mean the database, which everyone uses, is necessarily correct!

 

[GlennS]

ORIGINAL: tscaptain

ORIGINAL: GlennS

ORIGINAL: chrisjcoe

I don't think that insurance checker is free though, perhaps the club could provide this service?

Checking your own vehicle's insurance status is free

http://ownvehicle.askmid.com/

Curious. I put my other car reg in on the askmid website. Not on the database it said! Odd as the renewal went through on the 8th June. Phoned insurer who said phone DVLA. Phoned DVLA and they said "nothing to do with us, contact MID" You can't contact MID - and certainly if you could they wouldn't change anything on my say-so! FAQ on their website says if the reg doesn't appear on the website I may be pulled over by the boys in blue - contact your insurer! Full circle.
Second call to insurer who said the underwriters are the ones with the power to add details to the MID and why mine hadn't was a mystery. Of course had this thread not appeared the first I would have known about it would have been either when I was pulled over or tried to tax the car.

Moral of the story - you may be insured but that doesn't mean the database, which everyone uses, is necessarily correct!

GIGO - the age old law of computers. "Garbage In, Garbage Out".

The problem with any database of this sort is that it very often depends on "someone" entering the data. Human beings are fallible and data entry problems do occur - an incorrect digit (5 instead of a 6), someone forgets to do it... etc, etc.

I always carry a current copy of my insurance certificate in the car glovebox and I check the database online after renewal to make sure it is correct.

 

[tscaptain]

ORIGINAL: GlennS

GIGO - the age old law of computers. "Garbage In, Garbage Out".

I think this is more a case of "Nothing in, nothing out"[]

 

[geoff Ives]

Let's try an experiment.
Time 10:28. Sturday 3rd. August.
I have just renewed my policy with Heritage Insurance.
I told them I wanted my Certificate e-mailed to me and I told them why.
I will post again when I recieve it.

 

[geoff Ives]

ORIGINAL: geoff ives

Let's try an experiment.
Time 10:28. I have just renewed my policy with Heritage Insurance.
I told them I wanted me Certificate e-mailed to me and I told them why.
I will post again when I recieve it.

Certificate recieved 10:31.
How's that for service.

 

[tscaptain]

Try another experiment Geoff.

Over the following days put your reg in here

http://ownvehicle.askmid.com/

and see if and when it shows that you have insurance![]

It would seem that having a certificate, or even carrying one around in the glovebox, will not stop you getting pulled over and having to go through all the hassle of proving you are actually insured if your car doesn't appear on that database.

 

[rob.kellock]

ORIGINAL: chrisjcoe


This is an important thing to remember, saying you believed you were insured does not mean a thing, even if you have circumstantial evidence to back it up. At the end of the day, if you are not insured, you are not insured, and it would be up to you to seek redress if you were justified. Then, you'd have to have the same fight with the DVLA over any penalties that they applied.

You would have no fight with the DVLA. The police would prosecute you for driving with no insurance and you would be summoned to appear before the Magistrates Court for the area you were stopped in. The only involvement the DVLA would have would be if you were convicted, your licence was ordered to be endorsed and you failed to surrender it for the points / disqualification to be added.

You wouldnt have received an endorsement or fine either, with an experienced motoring solicitor (special reasons argument).

You may well be right, but affording a solicitor is a bit of a problem for a lot of people.

You would have an almost textbook special reasons application but you it would be by no means guaranteed to succeed - I think some Magistrates would expect you to check that the premium monies left your account and/or query sooner why you didn't receive your certificate. I have never lost a case in similar circumstances but awaiting the decision gets nerve wracking sometimes and I have seen it happen.

Unfortunately, special reasons applications follow a guilty plea so even if you win, you can't make a defence costs application to get your legal costs back (and even if you could, these are now restricted to legal aid rates so you end up out of pocket when you are completely innocent these days).

Quite a cautionary tale really.

 

[geoff Ives]

ORIGINAL: tscaptain

Try another experiment Geoff.

Over the following days put your reg in here

http://ownvehicle.askmid.com/

and see if and when it shows that you have insurance![]

It would seem that having a certificate, or even carrying one around in the glovebox, will not stop you getting pulled over and having to go through all the hassle of proving you are actually insured if your car doesn't appear on that database.

OK.
I entered 2 X Porsche cars, 1 Rover 200 and 3XDucati motorcycles... All OK.
Geoff