Understanding the T&C’s of Insurance
BUYING INSURANCE
- Remember to shop around when buying insurance – speak to a number of brokers, contact call centres of reputable companies and check online/mobile app tools for competitive quotes.
- A number of companies offer online quoting and insurance buying platforms – these are generally offered through secure websites and are safe to use, but always be vigilant that you are using a reputable company.
- Before saying (or clicking) “yes”, make sure know exactly what you are looking for, what you can afford and compare quotes by considering the benefits and exclusives against each premium quoted.
- Also make sure you are considering a reputable company, with a strong payout history; that you have considered all relevant benefits and exclusions, features of each policy and price of your monthly premium.
- Are you looking to switch insurance companies? Make sure you have compared apples with apples, cheaper is not always better and may leave you uncovered for certain eventualities. Also, consider if you will be immediately covered when switching.
- Tip: Typically, your premium is a calculated based on your risk factors as well as the “excess” that are expected to pay in the event of a claim. If you can afford to pay a higher excess when you claim, then ask for a quote with a higher excess option, as this will reduce your monthly premium.
INSURANCE VALUE ADS
- Insurers often have optional value added services on motor vehicle policies, such as:
- “Touch up” – dent and scratch cover for minor repairs, such as chips, dents and light scratches
- “Top up” – the insurer pays you the difference between the value paid out by an insurance policy in case of a vehicle write-off and the outstanding balance owed on a vehicle loan
- “Warranty” – cover to repair/replace major vehicle components in the event of failure or breakdown
Whilst these provide additional protection, it is very important to understand the conditions and exclusions for each of these before buying them.
INSURANCE AND LOYALTY REWARDS
- Insurance should not be bought because of rewards offered, but because it provides you the best protection you get at the price that you can afford.
- “Rewards” come at a cost. At the end of the day, you are still paying for those rewards in some way.
- Another thing to consider is the probability of actually getting those rewards, as well as the conditions attached to earning the rewards.
ONCE I’M INSURED, WHAT ARE MY RESPONSIBILITIES?
- It is your responsibility to understand your policy and it is your insurer’s responsibility to explain it to you. Very often, once you get insurance you think you are well protected and naturally you feel a certain peace of mind. However, to your surprise at claim stage, you find that certain things are not covered or not suitably covered. You owe it to yourself to really understand what your policy covers and what it excludes. If you don’t understand some terms or exclusions, ask your insurer.
- Another of your responsibilities as an insured is to maintain your policy up to date. For example, as you buy more or newer items for your home, you should update the value of your contents insured. Sure this will increase your monthly premium, but you’ll not run the risk of being under-insured and then not being fully paid in the event of a claim. The opposite is also true; if you “downsize”, then the value of your insured contents should be decreased.
- Similarly, you should let your insurer know of any significant change in your risk profile as this may again impact you at claim stage. For example, some insurers use your place of work or the nature of your work as a risk factor. So, if this changes, let your insurer know, and who knows you might even get a decrease in your premium!
- Your personal circumstances change over time and your tolerance for risk may also change as your family and assets grows. So, in addition to updating your insured value or updating your risk information as and when things change, it is also recommended that you regularly review your insurance needs. For example, you may have previously decided not to insure your home contents, but as you accumulate assets, your risk increases and you may need to reconsider.
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— Arrive Alive (@_ArriveAlive) May 16, 2017