Car Insurance nonsence

letsbehonest

I have just recieved this email from my brother-in-law

Dear all,

Sorry to have to have such a huge 'mail shot' but I think that all car drivers need to know the following. It is a little long winded, but I would urge you all to read the following:

I have just received my insurance renewal notice and the premium has risen by £80.05 from last year. I phoned a representative of my current insurer to ascertain why that had been such a steep rise.

You'll love the answer:
In April of last year I had come to a halt at a junction and was hit from behind by a 3rd party. There was a scratch and one broken bulb on my car so we exchanged details etc and upon my return home I phoned my insurer to report the accident, and as I was taking the car in for an annual service the following week, asked if I could have the mechanic check the car to ensure that there wasn't any more damage. Fine. So I did just that and there was no more damage found. I therefore phoned my insurer and informed them that I was not going to make a claim. All OK and I forgot about it.
However - The reason for the huge rise in my premium - because I had been involved in a NOT AT FAULT accident! Further, I was informed that someone who has been involved in a not at fault accident is more likely to be involved in an OWN fault accident so their premium is increased! The rep. went on to try to justify this new policy saying that it depended on my speed - she had no answer when I told her that my car was stationary. After a lengthy discussion she offered to reduce my premium by £35 but I refused, stating that even if they were the cheapest, I would not renew with them on principle. The company concerned is Admiral, the parent company of Diamond.

I have since spoken with reps. from a number of insurers and have established that there is now a growing trend by insurance companies to increase premiums for all drivers who have a NOT AT FAULT accident!

Now I believe in following the law of the land, but it will now make me think twice about contacting my insurer if a similar situation occurs in the future. I leave it to you to decide what you should do.

You might like to warn other car drivers you know.

Thanks

Derek

taxiphil

It's absolute madness. Not only were you not at fault, but you didn't even make a claim! But apparently they are allowed to take this information into account as part of their "risk assessment". The same thing happened to a friend of mine - he phoned his insurer to get a recommendation for a repairer after his car was broken into. Even though he didn't make a claim as the repair cost less than his excess, they still used that information to inflate his premium!

Vote with your feet - take your custom elsewhere. You don't have to declare it when getting a new policy with another company, as you didn't actually make a claim. That's what makes it so ridiculous - your current insurer is punishing you for something that a new insurer won't punish you for!

gyzmo

Got to say that the response shows no understanding of insurance principles at all.

Blame is really irrelevant in an accident when it comes down to premiums. What matters is whether or not the insurance company gets its money back or not. If it does, then your premiums are not affected to a great extent. If it doesn't get its money back, then it will be considered a high risk in terms of the potential for losses in the future, and so will hike up the premium a lot more.

The insurance company will not care where the money comes from (so long as it is legit) - you can pay them back the costs if you want to and you should see the premium decrease.

andyrules

I've got a better one than that, involving home insurance. A couple of years ago, about half way through my home insurance period, I rang to add a new item of value to the 'all risks'. The broker rang back to say that the insurer would not include the item, so I grumbled a bit but thought that was that. Not so, the broker went on to say the insurer would not EXCLUDE it either, and because I then owned a valuable which had nothing to do with the insurer, they cancelled the policy!! Even the broker didn't get why!

Bossyboots

gyzmo wrote:

Got to say that the response shows no understanding of insurance principles at all.

Blame is really irrelevant in an accident when it comes down to premiums. What matters is whether or not the insurance company gets its money back or not. If it does, then your premiums are not affected to a great extent. If it doesn't get its money back, then it will be considered a high risk in terms of the potential for losses in the future, and so will hike up the premium a lot more.

The insurance company will not care where the money comes from (so long as it is legit) - you can pay them back the costs if you want to and you should see the premium decrease.

But the OP states they didn't make a claim - ergo the insurance company paid nothing out, there was no money to recover, and no loss to the insurance company.

gyzmo

I would suggest that the insurer has done something wrong somewhere, or the advisor has got their facts wrong. I haven't been involved in insurance for some time, but what has been said goes against all the basic principles of insurance built up over the past few centuries. If that is the way things are going, then I'm glad I don't need to insure a car.

Astaroth

The exception to it is if the person has had numerous non-fault accidents. Whilst an insurer pays out £1000 for a claim and gets the £1000 from the fault party they are not entitled to claim back the actual cost of making the claim itself back (ie staff costs, postage, phone calls, locus reports, investigators etc) which reflects a true cost for the insurer. If someone is having 2-3 non-fault claims a year it will quickly add up

Certainly premium loading for a single non-fault incident is unusual

Bossyboots

That seems entirely unfair that a policy holder should end up paying out for something that isn't their fault although I think I would be inclined to wonder about the driving abilities of someone who has a number of accidents, non-fault or otherwise.

I'm glad now I dealt with the third party insurer direct when my car was written off.

Altarf

The answer is if you are involved in an accident where someone else is to blame to claim, is to add onto the uninsured losses that you claim from the other driver the increase in premium that you will pay due to them hitting you (not forgetting that the loading will last for several years).

Impet_Limpet

so if i had an accident (hit from behind when i was stationary) and sorted it out via a third party company therefore my insurance not involved, do i not have to declare it when looking for a quote?

Altarf

Martine1081 wrote:

so if i had an accident (hit from behind when i was stationary) and sorted it out via a third party company therefore my insurance not involved, do i not have to declare it when looking for a quote?

Yes you do.