Insurance

[onetrack]

I've just about had enough of insurance companies at present. It started with a blown-up 3HP reverse-cycle air conditioner about 3 mths ago, caused by a power surge.

We're insured with AAMI and they refused to pay out, citing all the fine print that says they don't have to pay out, unless the surge was caused by an event that happened on the property, such as a storm hitting the house, or a tree on our property falling on a power line.

 

Western Power also refused to pay us anything, claiming it was an "unknown event beyond their control". What a cop-out from all these pricks. We ended up having to pay nearly $3000 for a complete new A/C unit, because you can't just buy the inside evaporator unit or the outside compressor unit, they're only available as a combined unit. Makes you wonder why it's worth even paying for insurance. Add to that, premiums that are absolutely rocketing with every renewal.

 

So yesterday, it was car insurance renewal time (for SWMBO's 2012 Camry). We've been with AAMI on that, too - but the renewal came in with a 30% increase in renewal premium - for a substantially reduced car value.

Then there's this stunt of "market value" or "insured fixed value". The market value is one of the dodgiest figures around.

 

It appears the companies idea of market value for the car is around $11,500 - $12,000. But the car has only done 90,000 kays and is in mint condition. There's similar Camrys with over 120,000kms being advertised for $16,500 - $17,000 - and the car sale sites say "this is a fair, average asking price". I reckon the car is worth at least $14,000 - but as soon as I put in "$14,000" as an insured agreed value, the premiums rocket up by another $100 or $150.

 

So I try to talk to someone in AAMI - and I get a generated AI creature, which is a dark-skin-toned woman with blue eyes, who wriggles around like a cartoon character, and who evades all my pointed questions.

As soon as you say the renewal premium is too high, you get told you can reduce it by increasing your excess or lowering the insured value. I don't want to do either! - the excess is already $900! - I just want a fair insured value and a renewal premium that doesn't go up by 30% every year!

 

I couldn't even tell AAMI on their website that I want to cancel the insurance. Everything there is designed to run you around in circles until you're defeated and tired, and just pay their asking price.

 

So I go looking for "best car insurance" reviews on Product Review. I find Senior Insurance has glowing reviews, around 4.7 out of 5, and winner 3 years in a row. But when you start examining all the reviews, I find corporate manipulation at its best.

About 98% of the reviews are about how the insured rated the company website and ease of acquiring insurance - very little about anyone reporting claims experience.

 

When you do find the occasional claims experience review with Seniors Insurance, it's an absolute shocker, with "getting the run-around", "wouldn't pay out", "wouldn't pay for agreed items", "wasted 3 hrs on the phone with them and got nowhere", etc etc, - typical insurance companies.

 

Then when you get into it deeper, you find Hollard, the South African based insurer is behind 90% of the cheap insurers - Seniors, Budget, Youi, Woolworths, Coles, etc. And Hollard have an atrocious reputation for avoiding payouts.

 

The BIL had his near-new Hilux SR5 dual cab smashed recently up by dopey Chinese students who roared straight through a stop sign, and the BIL T-boned their car. He was insured with RACWA Insurance. RACWA is expensive, but generally aren't too bad to deal with.

However, the BIL has been getting stuffed around by RACWA, too. His Hilux was insured for an agreed $45,000 and RACWA dithered over whether it was a write-off or not. Then they left the Hilux with a repairer who had it for a month before he decided he didn't want to repair it, or it was too big a job for him. So RACWA just forgot about it. BIL had to rev up RACWA to get moving on it again - so the Hilux got dragged to another repairer, who is now working on it. They say they hope to have it finished by Christmas.

 

But it's now been over 2 months since he pranged it - and RACWA gave him a hire car - but only for a maximum of 21 days. So that's finished. On top of that, BIL found out HE had to insure the hire car!! It just gets better all the time!!

 

I went through about a dozen insurers yesterday for the Camry, trying to get a better deal. There were a multitude of insurers with heaps of conditions and escape clauses, and high premiums. It was a right PIA.

I finally went with GIO because they agreed to insure the Camry for $14,500 for only $2 more than AAMI's renewal price, and with an $850 excess instead of the $900 that AAMI wanted.

 

You get bugger all with basic insurance - no glass cover, no hire car, more excesses for a range of events such as younger drivers, and so on and so on. I only hope GIO are satisfactory to deal with, but all the reviews show that they're no different to any other insurer, with payout fights, inability to contact anyone, unable to come to satisfactory agreements, etc.

 

Interestingly, Suncorp own both AAMI and GIO - as well as about a dozen other insurers! - so, typically, the huge corporations have all the insurance backing sown up.

[gareth lacey]

Insurance companies= parasites,insurance is big business they make more profit than banks and every time thier is a flood or fire up go the rates ,a friend in brisbane has had her house go under in the last 2 big floods here , her bill this year is $30,000 she has a very ill husband who wont be here by xmas,and she is retired her house has been rebuilt but is now worth 500000 less no one will buy it in the flood zone near the uni, the insurance co are PARASITES

 

Edited November 15, 2023 by gareth lacey

[facthunter]

There IS a big monopoly in the Game, Suncorp and they pay the repairer coolies rates. Ask a few repairers what's the best mob to deal with.  Nev

[old man emu]

41 minutes ago, facthunter said:

Ask a few repairers what's the best mob to deal with

Probably the very best place to start your purchasing research. Go to the blokes who deal with insurers from the customer's side of the equation. If an insurance company is a good payer to the repairer, then it means that they might have a reasonable approach to accepting a claim. 

 

I have my bike and car with Shannons. Both on the one policy, and they keep upping the value of the bike each year. I haven't had a claim, but they have been pretty good to deal with when I wanted to manage the policy. Of course, Shannons is owned by one of the big insurers - possibly Suncorp.

[rgmwa]

I just renewed our house  (building) insurance. The premium jumped over $400 to just under $2k compared to last year. I’m sure the fact that we claimed last year for the first time in more than 30 years for damage to walls, carpet and bathroom cabinets and some tiling caused by a leaking water pipe had nothing to do with the increase! No doubt the separate contents insurance will also go up when we get the next bill. 
The plumbers had to remove about 35 shower tiles and cut into the brick wall to find the leak. To my surprise, that damage wasn’t covered so it cost us $1000 extra to get repaired. Apparently the insurance only covered damage caused by the leak, not damage caused by efforts to find the leak! It probably cost RACWA $12k all up and apart from very poor communication and about 4-5 months from start to finish the final result was pretty good, but it was hard work.

We also have a small rental property occupied by our daughter at the moment. My landlord insurance premium just went up literally 100% for no obvious reason. I got another quote but it was near enough the same so I just paid it. 

[red750]

Better NOT join the A Team, eh, Julio?

[facthunter]

Shannons is Owned by Suncorp but they "leave us alone with OUR business plan ". I can't fault them.   Nev

[spacesailor]

One track 

You Are not as ' unlucky ' as my neighbour, 

Their AC has been on the blink for the last three owners. 

I said start with the cheapest component to replace ! , they ( all three ) had sparkles test the wiring   & past it OK .

SO , One $ 3800 new AC . Later  it stopped again . Just needed a new " circuit breaker " .

What a joke, three electricians couldn't find a crook circuit breaker. 

spacesailor

 

[Bruce Tuncks]

I had been amazed at how youi suggests in their ads that you get a bigger and faster payout from them... I didn't know that they are all owned by the same lot, so thanks.

Many years ago, I foolishly opined at a club meeting about how insurance companies were crooks. They made me Insurance Officer next time around, but I was as bad as anybody else. There is always the possibility that some fool might injure a young doctor in such a way that we needed insurance to pay out millions.

You can be uninsured yourself because you have control all the time, but when you are relying on strangers to do the right thing, well the thought makes me at least, turn to water.

I stopped insuring my gliders 30 years before retiring from flying them, and came out so far ahead that I wished I had banked the premiums. In any case, after 20 years, I was ahead financially.

I don't know anybody who insures their expensive self-launch gliders these days. After all, they are just toys that you can live without and the premiums are too far removed from the actual risk that it is just poor business to pay.

[onetrack]

I've read where insurers are charging premiums of around $30,000 to insure people in flood-prone areas after the recent floods. Why would you even bother? A serious flood event happens once every 50 or 100 years, where do these people get their premium calculation figures from - dartboards?

[rgmwa]

Another good one is insurance for houses in cyclone-prone areas such as around Karratha and Port Hedland in WA. The insurance companies charge home-owners unaffordable premiums because of perceived risk, ignoring the fact that houses and other buildings in those areas have to be designed for the expected cyclonic wind speeds. For example, buildings in Perth need to be designed for (generally) 45m/sec (162km/hr) basic wind speed. The same building in Port Hedland needs to be designed for 80m/sec (288km/hr). Since pressure is a function of the square of wind speed, that means 3.55 times more wind pressure on the building and therefore a much stronger building, but try to convince an insurance company that they shouldn't charge any more than for a building in Perth. On the other hand, Cyclone Seroja wiped out half of Kalbarri in 2021, because it came unusually far south and hit an area that is not considered cyclone prone, so the buildings are designed to a lower wind speed standard. I'll bet their premiums went up - at least for those owners that still had buildings.

[old man emu]

1 hour ago, onetrack said:

where do these people get their premium calculation figures from - dartboards?

Premiums are carefully developed from a wide range of statistics by people called "actuaries", a word that originally meant "registrar, clerk," from Medieval Latin actuarius "copyist, account-keeper, shorthand writer". The meaning "person skilled in the calculation of chances and costs," especially as employed by an insurer, is from 1849.

 

However, the most important statistic in calculating the amount of an insurance premium is the balance sheet bottom line, which comes from the bean counters in Accounts.

[Bruce Tuncks]

About 50 to 60 years ago, life insurance was a tax deduction, and so you had to put up with lots of well-heeled salesmen trying to sell you life insurance.

I was saved because I didn't believe that going gliding really put me into a higher category of risk than smoking did. The salesman told me that cleverer-than-me actuaries had worked it all out and I should believe them. ( I was willing to accept that they were clever than me, the sticking point was that I did not believe they would be honest with me.)

[pmccarthy]

I think it was called life assurance. You could cash them in tax free after eight years. I used to take out a new policy every year.

[gareth lacey]

I had a friend years ago who sold insurance (a broker) he was a great salesman could sell ice to eskimos, sold life insurance to people who could really not afford it, also all other types of insurance now he has is very well off(millions) and has got out of the game,  2 years ago i spoke to him about it and why he never tried to sell me on insurance ( i only have insurance on the req ) his reply was , You didnt believe the bullshit that i spruked ,  i said in reply but do you think that it is immoral to tell outright lies to prospective clients , his answer was , they paid me to much money,i shook my head , nice bloke in reality, does do a lot of charity work and gives his time and money to worthy causes now

[red750]

I was always told that "insurance" was to cover you "in case something happened", eg car insurance for accident or theft, house insurance for fire, flood etc.., contents insurance for theft, and so on. Things that may happen, but hopefully would not.

 

Life "assurance" was cover for something that will happen. We are all assured of dying. No-one gets out alive.It is to protect your loved ones, those who depend on you, when you die. Mortgage insurance is one form of that, ie., pay off the mortgage if you die. To a large degree it was replaced by superannuation.

 

I once worked for a company, for a very short time, that sold accident insurance, mainly to tradies. Basicly, the terms of the contract were such that it was impossible to claim on, like hospitalisation for more than two weeks. Just being off work was not sufficient. The supervisor would hold meetings  with the field agents at McDonalds. We were warned to be ready to run if any 'clients' picked up something to beat us with.

[gareth lacey]

34 years ago i was working at the submarine base in ( tradie self emloyed) sydney, i was climbing to a scaffold to weld out some pipes when my ladder broke in half 6mtre fall, rushed to hospital with broken hip, after 4 weeks in hospital put a claim in with insurance (my wife was pregnant at the time with our twins7 months in) claim was rejected because they deemed i could do other work (i was on crutches ) ie sitting at a desk, etc etc , insurance is a crock, after that i never insured myself ,put monies away instead i say it again PARASITES

[nomadpete]

Well.....

 

I am no friend of insurance- after all it is a scheme for averaging life's expenses  over a long period, then adding a profit margin.

 

However.

 

I have had health insurance  since it basically became compulsory.

 

If I paid it for  50 years (actually only been  paying it for about 40),

I would have paid about $90,000.

So far I know  it has paid out over 120,000 in the last 6 years.

For me, it has worked out well.

 

But don't start me  on about house or car insurance.

[Jerry_Atrick]

Insurance is about allocating the risk of an event of whatever you are insuring. I had a life  insurance policy for £1m that was costing me £8/momth.. there was one catch; it would only pay out if I was killed as a result of a "public" transport accident, which in the policy was defined as any mode of transport where the passengers of a single vehicle were open to the members of the public at large and the passengers were not at the discretion of the policy holder or the sole discretion of the person/s operating the vehicle.. so some such guff. Basically private transport but open to the public such as airlines, etc. was incuded. For me, it was a great risk management tool for my young fdamily as I spent a great deal of time travelling with work. There were very few exclusions, and business travel was an explicit inclusion. I was a million-miler with the Star Alliance, through Ansett... a fat lot of good that did me in the end.

 

Anyway, fast forward a few years, and the big insurance misselling and unfair terms scandal hit, and insurers were ordered to refund all valikd claims, and the regulators were hot on ther tail. Look up PPI Missellign as an example..

 

This insurance I had was also investigated.. and found to be on the level.. Darn it.. as I had cancelled it long ago and coudl have got some money back!

 

BTW, a life insruance sales person at the time trying to sell us more insurance thoough it was a good deal for the insurance industry.