Do you remember when we had something called insurance ? No, really we did
It was a very good idea Let me explain how it worked.
In return for insuring the contents of your house against mishap from within or without an insurance company would do its sums and charge you a fee, a premium.
The terms were laid out clearly and in the event of a claim the insurance company would check that there was no foul play evident and then pay out.
Simple.
Not any more.
The insurance companies realised that they could afford an awful lot more champagne and foie gras for the directors if they introduced something called an ‘excess’. An excess to match their excess if you like. Of course the public are no saints and there were a few scoundrels who robbed their own houses, or indeed burned buildings down to claim on the insurance and collect the cash. But I like to think it was the rising cost of champagne and foie gras that brought the excess in.
Now you will find that the value of your claim will be less than the excess, so in effect for most things, despite paying your insurance premiums you won’t actually be insured.
I know all this because I have just adjusted our contents and fabric policies. Now I am paying a quarter of what I was before by the simple expedient of having the highest possible excess on the policies. Given that I can’t afford to claim for any small loss I have decided to insure for large loss only – a full clearance burglary or a gutted house.
Mind you the specifications of the deadlocks, the lockable windows, the fully monitored alarm service and so forth are a nightmare and the insurance company will weasel their way out of anything if they can, so I am wary. There will also be conflicting and confusing information in the small print, obfuscation of the most calculating kind which will probably mean my insurance is invalid if we are burgled in a month with a vowel in it but I am doing my best.
It is also worth noting that you are likely to receive a payout, less your excess, for any claim made in the early part of an insurance company’s financial year much more easily than you will in the latter part of their financial year. This is because their risk is assessed actuarially and once they have paid out what they have budgeted for they will resist paying out any more. And so they will fight your claim.
“You didn’t declare on the proposal form that you wear glasses. And were you wearing glasses when you tripped and let slip the Ming vase ? No, you were not. So I’m sorry you are not covered. Please read the section on ‘Wearing Glasses’ in the Policy Document.”
Of course you only wear glasses for reading and had you been wearing them while carrying the vase, this would definitely have caused you to trip. But the insurance company small print is clear now that it has been pointed out to you and you should have declared that you use glasses, even if only for reading.
Frankly I don’t expect to get paid out if something goes awry and we need to claim. In fact I was on the brink of leaving insurance alone altogether but this is where insurance companies are so crafty because there is always the niggling thought of what if...
