In our perusal of the Internet and just general conversation with the public, it is obvious that the Insurance Industry hasn’t got the best of names. The main reason for this seems to be how Insurers are deemed to wriggle their way out of claims. I thought I would offer our insight into this as the middle men in a (probably futile) attempt to change some of the public opinions.
The main point is that an Insurance Policy is a legal agreement between Policyholder(s) and the Insurer. The Insurer’s side of this agreement is that they will pay compensation for anything that is covered in the Policy. Yes there will be exclusions, terms and conditions but these will all be made available to you before taking out the policy. If any of these are not acceptable to you then it would be best to arrange for the policy to be altered to your requirements if possible (by way of an endorsement on the policy to say a certain exclusion is not applicable to you which will probably result in a premium increase) or to arrange insurance with a different provider before taking out the cover. Always remember, you decide who to insure with so not being happy with certain exclusions at the time of a claim is not really the Insurer’s fault.
The Policyholder’s side of the agreement is to provide accurate information to the Insurer so that they can access and rate the risk you are proposing to them. This information must then be kept up to date so any changes in circumstances should be told to the Insurer immediately so they can continue the Policy on the correct basis. This is the biggest stumbling block and the reason why claims end up having their payout reduced or even repudiated.
Insurers have obtained this reputation of getting out of claims because this is the main point in time that they check all the information provided is correct. At the time of taking out the insurance policy, they will take your word that all the information is correct. They don’t have the time and resources to check every single policy (imagine them coming round your house to make sure it is semi-detached and has 3 bedrooms like you told them to every person that takes out Home Insurance). However, when you claim they need to make sure you have kept your side of the agreement by giving them correct information. If you haven’t then they probably have the legal right to not pay you a penny.
We are Insurance Brokers so our concern is to keep the customer happy. We will therefore always help to ensure a customer receives the compensation they are entitled to. In our experience though, it is when information provided by the customer is wrong that causes the most issues with claims. With most Insurance Policies being processed by the customer online nowadays, it really does mean that the customer is fully responsible for the information provided so it is important to check every single piece of information you are disclosing. You will normally be provided with a Statement of Fact after taking out the policy and it is vital that you double check all the information is the same as you provided.
We’ll probably struggle to change the opinion that the public have on Insurance Companies but try and remember that they will always keep their end of the bargain as long as you have too!