Is it legal to be asked to pay the excess in order for it to be added to a gift card settlement?

LiverpoolLiz

I have had my contents insurance with John Lewis for many years and have never had cause to complain. However last year I had to make a claim for a bracelet. assumed lost from my wrist. I provided photographs of me wearing it, and explained that it was bought in Spain, so 18k gold etc as verified by a local jeweler. It was valued by RSA  Insurance Group on behalf of JL at £1,100  - so £900 after the excess. I was told I could buy a replacement at Mappin & Webb, Watches of Switzerland or Goldsmiths - all of which are the same group and offer over-priced baubles rather than the discreet chain link bracelet I wanted to replace my lost one, plus we were in lockdown.
I went back and asked about a cash payment and was told I would receive £300... not good. I wrote to John Lewis and it was agreed after some while that I could have a GemCard which would be spent at a wider variety of outlets. I eventually accepted this but was very surprised to be called by RSA and asked to pay the £200 excess by credit card in order that RSA could add it to the GemCard - a company which it appears they own. I did so but afterwards considered I should not have done. 
Is this actually illegal or just immoral, given that RSA has an interest in ratcheting up the value of their GemCard, not least because I note from a casual Google that many people have trouble spending them (there are restrictions, at store discretion apparently). 
Furthermore the card arrived in regular unregistered mail and did not require me to activate it - so it could have gone anywhere. £1,100 in the mail!
John Lewis seems uninterested in any of this, which I find surprising.
Happily I've not had to make many insurance claims in my life but when I have the excess has always been deducted from the settlement. 
Can anyone advise on the rules, if any, around the treatment of an excess as I am minded to complain formally. Thank you.

Browntoa

You are up on the deal , your excess would normally be a cost when you claim and would need to be paid either way . They have added the value to your gem card so technically you are already better off by £200 on the claim .

I cannot see what your gripe is unless you are still peeved that your couldn't get cash 

Browntoa

Your earlier thread , from July , on the same subject.

Claim seems to have taken a long time 

https://forums.moneysavingexpert.com/discussion/6172319/lost-bracelet-insurer-offers-replacement-via-unsuitable-stores-of-less-than-one-third-in-cash#latest

Sandtree

What does your policywording say? If it says your excess will be deducted then they have no grounds but if it says you must pay the excess then clearly you've signed up to paying it.

Irrespective of if RSA operate "GemCard" or are buying it from a third party they clearly do not pay the face value and so clearly its in their interests to enforce their T&Cs of you paying the excess if thats what it states as adding another £200 value to the card will cost less than the £200 you give them.

LiverpoolLiz

Yes, the claim took a long time - both JL and RSA kept dropping the ball. I will check the word on the excess though can't see anything about it in the basic dox. The point is that RSA/GemCard has an alliance with retailers and therefore an interest in your spending as much money as possible with them - or in having a card you don't spend out. A cash offer should have been 50%

Sandtree

LiverpoolLiz said:

 A cash offer should have been 50%

The FOS allows insurers to reduce cash settlements to reflect the corporate discounts they have with their preferred suppliers but if you think they have unfairly reduced the cash offer then register a complaint and escalate to the FOS if you remain unhappy

LiverpoolLiz

Not sure that exactly fair. The other worrying aspect is that LMG - Loss Management Group/ LMG Jewellery - own GemCard

paddyandstumpy

Doesn't matter who owns who. 

I still fail to see what your problem is, you have a excess on your policy, which you have paid. 

Whether it's added to the settlement and you pay insurer or it's deducted from the settlement, you've ended up in the same position. 

Your 'down' your excess and the item of jewellery, and 'up' by the cost of replacing it in return. 

Sandtree

paddyandstumpy said:
Your 'down' your excess and the item of jewellery, and 'up' by the cost of replacing it in return. 

Net financial position is the same but it forces a like for like replacement and spending £200 on jewelry whereas the OP may be happy to accept a downgrade to a cheaper item and leave the £200 as cash in the bank in the current climate.

sheramber

£900 after the excess. 
They could have given you a Gift Card for £900 so you have in fact gained.

Tokmon

sheramber said:

£900 after the excess. 
They could have given you a Gift Card for £900 so you have in fact gained.

Exactly this; not sure why anyone would complain about being £200 better off.