Unfair Npower Boiler insurance?

javajim

I hope this is in the right place for this, if not please change.
I changed our boiler insurance from Homeserve to Npower in December/January because they included an annual service.
Their engineer called on Tuesday to service it and discovered a gas leak, so he turned the boiler off.
Yesterday we had a telephone call from Npower to say that we had to pay for the repair because of the age (about 18 years) and make (Vokera excell 80 SP). When we took the insurance they accepted it.
In their terms and conditions, eligibility requirements it says
'prior to the start of the Agreement Period, to the best of Your knowledge, be free of any defects or damage'
We weren't aware of the leak and the boiler has been used daily.
The cost quoted is £272.67 including vat.
Please give me any advice
Thanks in advance

InsideInsurance

This is a service plan and not insurance.

Looking at their top tier cover it does state that some models etc are not covered and if this is the case then they will refund you the monies paid once they discover the issue.

javajim

InsideInsurance
Npower knew the make and model when we applied and they obviously accepted it as they gave us the insurance.

InsideInsurance

Unfortunately as it is not insurance your only option is to take it up with them. There is no protection of the Financial Ombudsman when it comes to service plans and hence why the likes of Dixons warranties etc are all very carefully constructed to be service plans and not insurance.

zaax

18 years is quite old. Does the service plan include a new boiler as the boiler is going to need replacing quite soon.

Running_laps

I always read things like this and want to say to people really consider the cost of these service plans.

The company providing it needs to include there costs of selling and administrating them, there profits and then the cost of meeting their obligations under it. I imagine the first 2 parts come to at least 30% of the cost if not more. There are lots of get out clauses and at the end of the day the cost of getting the benefits yourself is probably lower. As such don't waste your money and put any money aside into a warranties and service plans account.

dunstonh

The company providing it needs to include there costs of selling and administrating them, there profits and then the cost of meeting their obligations under it. I imagine the first 2 parts come to at least 30% of the cost if not more. There are lots of get out clauses and at the end of the day the cost of getting the benefits yourself is probably lower. As such don't waste your money and put any money aside into a warranties and service plans account.

Whilst I largely agree with what you are saying, we have British Gas boiler cover and it has saved us a lot of money. They service it each year within the cost and it has just had its 6th circuit board in 17 years. There are probably more new parts in it than old! So, it is the one area where I feel a service plan is worth the while.

However, npower recently tried to market us to use theirs which was cheaper. Too cheap I thought and the quality was not up to what we had. Hence why it was cheap.

InsideInsurance

Running_laps wrote: »

The company providing it needs to include there costs of selling and administrating them, there profits and then the cost of meeting their obligations under it. I imagine the first 2 parts come to at least 30% of the cost if not more. There are lots of get out clauses and at the end of the day the cost of getting the benefits yourself is probably lower. As such don't waste your money and put any money aside into a warranties and service plans account.

But they do also have offset against all of that the fact they have "guaranteed" business.

So if dunstonh's boiler hadnt been covered for its 6 breakdowns then the company would have had to tender for and expending costs for each of the 6 jobs. They may or may not have won some or all of them. So the total cost may be less than just billing for the 6 jobs even after considering marketing costs but it did all go to them rather than a competitor.

Similarly these are the people that are claiming. There will be plenty of people that dont even take the free service - I know my mother was one of them - in which case those really are money for old rope and will partially fund those who are less lucky (similar to how insurance works).

Its certainly worth doing your sums but just because a company sells something and thus must be making a profit on it doesnt mean it represents poor value for the consumer.