Insurance for appliances

Mistral001

I just wonder how much of the insurance premiums actually go to repairers who repair the appliances after the insurance company get their administration costs and profit and the store who sold you the insurance get their commission. Going by experience, of owning appliances over the years and the cost of their repair, I would have thought 25%.  

grumbler

Mistral001 said:

I just wonder how much of the insurance premiums actually go to repairers who repair the appliances after the insurance company get their administration costs and profit and the store who sold you the insurance get their commission. Going by experience, of owning appliances over the years and the cost of their repair, I would have thought 25%.  

More, but that's for extra visits that otherwise could be avoided, unneeded repairs, and 'beyond economical repair' diagnoses of lazy and incompetent 'engineers'.

KxMx

It's not just the cost of a new appliance though.

The old one has to be disconnected and taken away, the new one has to be delivered and installed.

I did three new appliances when I moved a few months ago, those that haven't needed a new one for a while might be surprised at the costs involved these days. Even the cheapest way overall cost me a lot of money and I didn't even have any old appliances that needed to be dealt with. 

Also reasonably priced, reliable repair people are very difficult to find. Often it's best part of £100 for them just to walk through your door.

Bigphil1474

grumbler said:

Bigphil1474 said:

We have a policy with Domestic & General just for our Electric/Gas range oven. It costs about £200 a year,.... We've had maybe 4 occasions we've used them in the last 5 years so I think I'm not too far out of pocket.

£1K over 5 years to service some bloody cooker?! You must be joking!
Both my hob and oven are 20 y.o. and I didn't pay a penny to keep them alive. 

We originally took the policy out because we couldn't get anyone local to come and fix it in the first place, the first years policy was covered by that first visit. The longest I've had to wait for a visit from D&D (they use Whirlpool engineers I think) is 3 days, whereas when my last washing machine needed looking at, i didn't even get a call back in a week. We ended up replacing it.

The policy is for all parts and labour for any repairs, we don't need it servicing anyway, plus some of it will ultimately be for replacement if it can't be repaired. Over those 5 years, we've had 4 different elements replaced, plus the fan, plus 3 call out charges and 10 hours ish labour, plus this upcoming visit - easily £1k worth. It was an expensive cooker when we bought it, so the extra cost is worth it IMO. It's a 7 gas ring hob, 2 oven + grill range cooker.

@Apodemus, they always check the whole cooker whatever they come to fix, and replace or fix anything else that needs doing. Last time, the guy even tightened up the grill door as he said it was a bit loose, I hadn't even noticed. 

Debran

"Which?" say don't bother

DullGreyGuy

Mistral001 said:

I just wonder how much of the insurance premiums actually go to repairers who repair the appliances after the insurance company get their administration costs and profit and the store who sold you the insurance get their commission. Going by experience, of owning appliances over the years and the cost of their repair, I would have thought 25%.  

Domestic & General loss ratios tend to be around 35-40% which is premium less tax -v- allocated claims costs (so the repairers costs but not their call centre etc).

Combined ratio, which includes whatever commission they are paying sales and their general operating expenses tends to be 85%-90%

Obviously the thing to remember however is when you are buying repair services to the volumes that they do the cost per service is notably lower -v- what you or I would pay.

This however is only their insurance policies... much of what they do is a service plan and combined ratio is likely to be less given overheads are less and requirements under IFRS are below those of Solvency II