Axa and the Claims Underwriting Exchange

ebaynumpty

I unfortunately had to make a claim on my household insurance as I accidentally shoved a nail through a central heating pipe while fixing a floorboard in our bathroom. Idiot that I am.
My insurance company (a well known underwriter) offered me the opportunity of using one of their contractors to come and fixed the damage. I agreed as it meant less hassle. Or so I thought.

We moved out and the contractor got very busy damaging our house even further to inflate his costs. I copied a discarded costing sheet from the contractor which specifically noted which parts of our house to damage.

Well to cut a long story very short, the Ombudsmen got involved and 2 years later Axa settled and gave us the costs for the reparation of our house including very minimal compensation. £500.

In 2013 I was doing some research and read something about the Claims Underwriting Exchange, who I'd never heard of before. It's a place where insurance companies list costs of claims to alledgedly prevent fraud. My personal theory they use it to bump up insurance premiums based on the size of claim amounts listed against you.

I did a subject Access Request and found that the well known underwriters had over inflated my claim costs by 35%, they did this by adding their costs as well as the contractors inflated costs. The settlement figure agreed by the ombudsmen paled into comparison what they had listed against my name.
I called the Ombudsmen again.

To cut another long story short, the Ombudsmen found in my favour and are ordering the Underwriters to reduce the amount listed to what I was paid and not their costs.

Now that I am aware of CUE I have insisted that all of the insurance companies list anything about me correctly otherwise they will face the Ombudsmen.

The end result, I now have significantly reduce insurance premiums.

I would suggest if anyone has had to make an insurance claim, you all check the value the insurance company have listed against them and if it's inflated, get them to change it.

David_InsDef

Gulp. Has it really come to this?

Shoot.
Me.
Now.

deutsch

Insurance premiums are based on risk. Those who make a claim/claims are more likely to make a claim in the future, therefore the higher premium reflects the higher risk.

CUE is to prevent fraud. People can incorrectly or not disclose a claim to keep their premium low. By sharing the claims history among insurers, all known information can be taken into consideration when the perception of the customer as risk is to be calculated.

The inflated costs on CUE were probably a data entry clerk just following a process. I.e - a load of invoices passed to him/her to add up and total an incurred cost / payout. It could also be a typo. Human errors occur. Look at stock markets and what they call someone with a fat finger (i.e too many zero's in a buy/sell)

As you confirmed, the contractor did more damage then there originally was against the loss. Only once you complained did this highlight this problem with the contractor.

CUE isn't always right. Like all databases, data can be old, incorrect, etc and these types of things will probably come under the Data Protection Act if they do affect you in a negative way.

Will all information be ever right? There is just too much information out there to process (information overload). Companies rely on their customers to keep the information they hold correct and vice versa. For example - The insurance company expects you to make them aware of a change of address. An opposite example is when you expect the company to store information about you correctly - in this case - the claims costs.

ebaynumpty

Thank you for that.

That's pretty much my understanding from Cue too. I understand the premise of fraud prevention, it's understandable.

I can understand and forgive an accidental data entry, I can maybe forgive a slight increase to my premium as I had to make a claim, but to add 35% to a claim. 10% of that, according to the Ombudsmen was the contractors inflated costs, which according to the Underwriters, was fraud and they have claimed back from the contractor. To then disagree with my complaint and tell me to go to the Ombudsmen was like a red rag to a bull.

The rest of the costs were the underwriters costs for having to deal with the bad contractor they employed they let loose on our home. I did not feel that this was appropriate or fair. The underwriters, according to the Ombusmen, knowingly and willingly recorded extra costs not directly related to my claim.

I was refused renewal, when I could get insurance it tripled my premiums.

What they listed did not in any way represent my loss or repair costs to my house.

As you can imagine the Ombudsmen are making sure they correct this.

My story is a warning to anyone potentially or sadly are in the same situation as me.

Write down everything, take pictures before, during and after the work being carried out, take meter readings, record everything and make sure the insurance company know that their costs are not your costs.
Only the claim cost directly related to your loss (the actual cost of repairing your home) should be (in the Ombudsmens view) recorded as that is the only thing that should be listed.
Not the insurance company's admin fees.

As the insurance company, underwriters, brokers never mention CUE and what they will do on it, it is open to interpretation. It is the person taking out the insurance who needs to take the responsibility to say to them, this is the addendum to the contract we are setting up. In me taking your insurance, if, god forbid I have to make a claim, you will only list the value of the loss and not your costs. They then have a right to disagree like any notice.

InsideInsurance

ebaynumpty wrote: »

I did a subject Access Request and found that the well known underwriters had over inflated my claim costs by 35%, they did this by adding their costs as well as the contractors inflated costs. The settlement figure agreed by the ombudsmen paled into comparison what they had listed against my name.

Why do you think the insurers costs shouldnt be factored in? Increasingly insurers have more and more in house expertise, why should those that employ their own adjustors and engineers have to log a different cost to the claim than those that employ external adjustors and engineers?

I havent looked at the guidance for loading data to CUE but normally things like professional fees, internal or external, complaint handling etc all do normally get charged to the claim and thus would by the nature of systematic uploads go into CUE.

Have you actually done any quotes and seen the difference that declaring a £1,000 and £1,350 claim makes? I did, out of curiosity, with the top 10 insurers it made no difference at all, with the 11th cheapest insurers it made it 10p cheaper.

Actual claims costs make very little difference to premium calculations and only when your talking about 1,000% or 10,000% increases may you actually start seeing material changes. In many cases insurers dont even ask the cost of a claim.

CUE is mentioned by inference of you consenting to exchanging information with other insurers and systems for fraud prevention. Its not named explicitly because not all insurers use it. Some only read from it and dont write to it. There are other databases out there for similar sorts of purposes that come up over time and its a pain to have to list every single one of them and not be able to use a new one when it becomes available as you havent informed the insureds by name of it.

ebaynumpty

Firstly, it's not my judgement that the insurers costs should not be factored in, it was the Ombudsmens. They told me and I am inclined to agree with them.

I got paid £12,000 for the damage to my home. Although the contractor caused more damage. We were displaced from our home for almost two years, the insurance company only paid for 3 weeks of alternative accommodation, I paid the rest and was not compensated for it by the insurance company. The insurance company/Underwriters listed my claim on CUE for £56,000.

Do you feel I was unfair to complain about that?

I don't think it was unfair of me to complain and I certainly have no problem telling an insurance company where to get off since they saw fit to misinform CUE and other insurance companies who look on CUE that I apparently, according to them, caused £56,000 damage to my home.

And yes I did a comparison, every year, as yes there was a massive difference to my insurance before and after the cost of the claim was factored in, only when the claim costs came down when listed on CUE was there a large difference in quotes and amount of insurance companies who would offer insurance.

I presented all this information to the Ombudsmen and they found in my favour. So again not my decision, the Ombudsmens.

I'm sorry I have a slightly different opinion to you, but I say to anyone, make sure you are not taken advantage of by any insurance company.

Quentin

Don't worry about reps from the insurers lobby telling you that you shouldn't complain to the FOS when the insurer appears at fault.


They forget the point of this website.


I regularly get accused (and abused) of suggesting "blackmail" from another "regular" from the insurance side when telling posters about the FOS charging insurers £550 when they take up a complaint - pointing out that an insurer often will take a business decision not to spend the £550 plus all the management time involved in dealing with the FOS and instead close the matter by way of a goodwill gesture to the complainant.


(No blackmail at all of course, just good moneysaving advice to use the FOS at every opportunity as it never costs the complainer, win or lose)

ebaynumpty

Thank you. :-)

InsideInsurance

ebaynumpty wrote: »

Firstly, it's not my judgement that the insurers costs should not be factored in, it was the Ombudsmens. They told me and I am inclined to agree with them.

I got paid £12,000 for the damage to my home. Although the contractor caused more damage. We were displaced from our home for almost two years, the insurance company only paid for 3 weeks of alternative accommodation, I paid the rest and was not compensated for it by the insurance company. The insurance company/Underwriters listed my claim on CUE for £56,000.

Do you feel I was unfair to complain about that?

I don't think it was unfair of me to complain and I certainly have no problem telling an insurance company where to get off since they saw fit to misinform CUE and other insurance companies who look on CUE that I apparently, according to them, caused £56,000 damage to my home.

And yes I did a comparison, every year, as yes there was a massive difference to my insurance before and after the cost of the claim was factored in, only when the claim costs came down when listed on CUE was there a large difference in quotes and amount of insurance companies who would offer insurance.

I presented all this information to the Ombudsmen and they found in my favour. So again not my decision, the Ombudsmens.

I'm sorry I have a slightly different opinion to you, but I say to anyone, make sure you are not taken advantage of by any insurance company.

No one is saying that you shouldnt complain to the ombudsman, its there for a reason and you have a right to use them. Unfortunately the ombudsman do come out with some very strange decisions (sometimes in favour of the PH and sometimes in favour of the Insurer) but that is equally their prerogative and there is the escalation process within the Ombudsman if you have an issue with them.

CUE does not contain the amount of damage you did to your property, it contains the total cost of settling the claim. If you had an at fault motor accident then it would not only have the cost of the damage to your vehicle but also the damage to the TP vehicle, the cost of their hire car, their solicitors fees, their injury, the engineer report on the vehicle etc. Which of those costs do you think is "fair" to report to CUE?

There could be some argument that rectification shouldnt be included in whats reported however in the vast majority of times if rectification work is required because of a mistake by a contractor its the contractor and not the insurer that foots the bill and at most the insurer pays could be a couple of hundred for an engineers report to decide if this is defective workmanship by the contractor or additional unidentified damage etc.

You also miss my point on the fact it makes no difference to you. I didnt say having a claim makes no difference, I said the 35% increase you claim they had booked would make no difference. In reality £12,000 to £54,000 however is not a 35% increase.

Even using those numbers I run 2 dummy quotes this morning on Confused.com and of the top 10 insurers only Endsleigh and One Call changed their quote due to the difference in the claim value and that could also have been their fraud detection system. Axa, Swiftcover, British Gas, Budget, Direct Dial, Post Office and Prestige all quoted the identical price irrespective of if the claim was declared at £12k or £54k

ebaynumpty

Thank you for your time and effort, but as much as you have done your own research in to some hypothetical figures based on two separate amounts, I found that there was a real difference in prices and the insurance company told me they were not going to renew because of the value of the claim.

In my experience I did find it hard to reasonably priced insurance for at least 4 years. As most insurance companies/underwriters and brokers have a policy whereby you only list the last three/five years of claims, in any event my insurance should be cheaper now anyway.

Sadly my view of insurance companies and anyone promoting insurance companies alleged fairness has forever been tainted and no matter how much of an advocate you are for the insurance industry I will never subscribe to your opinion.

Your opinion and view does not take away the fact the insurance company over inflated my claim costs. Which is liable and defamation.

Very sorry about that.

Quentin

InsideInsurance wrote: »

.....You also miss my point on the fact it makes no difference to you. I didnt say having a claim makes no difference, I said the 35% increase you claim they had booked would make no difference. In reality £12,000 to £54,000 however is not a 35% increase........

You look to have missed the whole moneysaving point in the OP:

The end result, I now have significantly reduce insurance premiums.