Home Insurance: What just happened?

Heliocentric

Hello,
My dad was taken into a care home earlier this year and we just found out that he hadn't renewed the house insurance since late last year (he has dementia) so I just called to take out a policy. My dad has been with this company for the past 2 years and hasn't made a claim in the last 10 years. As he is in a care home, my mum requested that she would be added to the policy (although apparently his name still has to be kept on despite having alzheimer's and not being able to make decisions). He is 82 and my mum is 78. They are both on the deeds.
The person on the phone asked lots of questions one of which being 'has his/her application for insurance ever been declined?' - the answer being no. She entered everything into the system and told us that the system declined it (which as I said has never happened before) with "unacceptable area" as the reason given. She said it might be considered a risk, I asked why then she backtracked and said 'i'm not saying that's what the reason is, it just might be'. She then asked me if I wanted the number for a broker, which I declined.
It feels strange that all of a sudden we have been rejected out of many years of having a "clean" record. I sort of feel as if we've been duped and now have a black mark on our names.

I'm not quite sure which way to turn as we fully expected to be able to take out insurance with them. If I knew the reason why it would help matters. It just feels as if they pried into our business, put all of our details on the system then just threw us aside. Is this normal?
Thanks.

Sandtree

Why are you wedded to using this company rather than checking the prices from a variety of providers?

Depending who the company is there could be a range of explanantions... say for example it was John Lewis then the likely reason is because its just a white label and for the last 5 years or so it was RSA behind the scenes and now its changed to Munich Re. Two totally different insurers with different risk appetites, views of what risks are etc.

In most cases, in my experience, front line staff are not given any explanation for reasons for declines, price changes etc etc. Unfortunately some try and be helpful by proposing possible causes but its little more than a guess from them.

dunstonh

The person on the phone asked lots of questions one of which being 'has his/her application for insurance ever been declined?' - the answer being no. She entered everything into the system and told us that the system declined it (which as I said has never happened before) with "unacceptable area" as the reason given. 

It is always worth remembering the telephone staff with insurers are usually low in knowledge and experience.  There will be a few experienced ones dotted around but generally, those with knowledge of how insurance works and the reason behind such things would not be answering the phone.   More often than not, the person you speak to is as good as what the computer tells them.    And because the employer knows they are low skilled, they don't feed them too much information that could trip them up into saying something they shouldn't.

It feels strange that all of a sudden we have been rejected out of many years of having a "clean" record. I sort of feel as if we've been duped and now have a black mark on our names.

Distribution channels, including insurers themselves, change their products every few years.  The reassurer on the policy behind the scenes can change as well.   So, you could be with that provider on their version 12 but their current new business policy could be version 23 with a different reassurer.    The new reassurer may consider different risks to the old one.

Version differences can also occur with different distribution channels.    The comparison site version may be a cut-down version of the broker version.   Bits of cover lopped out and certain risks removed to keep the premium lower.

So, just because it's the same company name on all these different versions, doesn't mean they are all the same policies.
The point of refusing cover can change over time as well. Often it's a totting up of multiple issues that cause the trigger rather than just one thing.    You say there was a gap in coverage due to the policy lapsing.  Some computer-based underwriting treats uninsured gaps as an increased risk.

Don't take it personally.   It's a healthy retail market with lots of choices available. 

Heliocentric

Thanks for the explanation. I am only 'wedded' to age uk because my parents are pensioners and my guess is that my dad chose this company because he thought they would be on-side if something went wrong. It might have even been a cheaper quote for him. I'm not familiar with house insurance but the company seemed like a safe bet for them.
I don't even know where to start. Do you use just any comparison site? How do you research this?

Sandtree

Heliocentric said:

Do you use just any comparison site? How do you research this?

Assuming you are a fairly normal risk and not a thatched cottage or a large art collection etc then most will try the aggregators first then the few insurers that don't quote via the aggregators. 

Heliocentric

Yes. Are they all equally trustworthy e.g. compare the market? Do I do forum research to find which companies actually pay out?

Sandtree

Heliocentric said:

Yes. Are they all equally trustworthy e.g. compare the market? Do I do forum research to find which companies actually pay out?

The aggregators themselves are... they ultimately just show you prices.

The companies you buy from, which will be a mix of insurers, brokers, MGAs and white labels of the former are going to be more variable in quality.  Certainly do some searching on the company before buying, do remember that the nature of insurance lends itself to more negative reviews than other classes of products. 

Home is actually a fairly complex product, make sure you know what you are getting before buying... so are things like Matching Set cover important or not? Do you need cover out the home? Do you want new for old or indemnity? People often under estimate the value of their stuff as contents has to cover EVERYTHING and people tend to focus on just the big items like TVs (large CD/Vinyl collections etc can quickly be worth more than a TV but get forgotten about)

dunstonh

I am only 'wedded' to age uk because my parents are pensioners and my guess is that my dad chose this company because he thought they would be on-side if something went wrong.

That is a little naive I'm afraid.   Not specifically against them but many of those companies linked to groups like this.   They are commercial entities. and their name is effectively being used by an insurer to sell more policies.

I'm not familiar with house insurance but the company seemed like a safe bet for them.

The current version is an Ageas policy.  You can buy Ageas policies direct or via other distribution channels.   It is quite possible, as mentioned before, that the original policy was not Ageas as Age UK only signed their 10 year deal with Ageas in 2015.

Yes. Are they all equally trustworthy e.g. compare the market? Do I do forum research to find which companies actually pay out?

Is that really a worry for you?  Age UK didn't compare the market.  They offered a product that was best for them commercially.  Did that enter your head when you tried to use them on the new policy?   

The issue is not trustworthiness but quality.  If you go for a budget policy on budget terms then you generally get budget coverage.  However, in the event of a claim, you would be dealt with in accordance of the terms.  That may or may not be an issue with some claim types but would be with others.

Heliocentric

Thanks for bringing these to my attention. What does "Do you need cover out the home?" mean? Do you mean things like the garden? How do you place value on something like family photographs or do you just accept that those things cannot be replaced?

Aretnap

Cover out of the home... he means do you want things like your laptop, mobile phone, watch, jewellery, fishing rod etc to be covered for theft, loss, accidental damage etc when you take them outside your home. This is an optional extra on many policies, often called something like personal possessions cover.

You can't put a value on things like family memories, your insurer will only replace things which can actually be replaced. So you only have to factor in the value of things which can actually be bought for money. 

Sandtree

Heliocentric said:

Thanks for bringing these to my attention. What does "Do you need cover out the home?" mean? Do you mean things like the garden? How do you place value on something like family photographs or do you just accept that those things cannot be replaced?

Home typically covers the full bounds of the property and so its more what you put on your person, pocket, handbag etc and take to work, shopping etc. Many will also cover you for outside the UK so take your engagement ring and anniversary present watch on holiday some home insurance will cover it (unlike the low single item limit on many travel policies). 

Insurance is practical so the value of items are purely material. Photos would be covered for the frame/album, cost of printing etc if you still have the negatives. Insurers however typically settle claims with gift vouchers or prepaid cards and so if great grandma's broach gets stolen they'll give you the value of it rather than forcing you to have a new broach that won't have the same sentimental value.