What Is wedding Insurance?

A wedding is about as an important event as you can get. The cost of wedding services can soon mount up, planning it involves the bringing together a great deal of ideas as well as the services of many professionals. The pressure for it to go smoothly is immense, and, unfortunately, the scope for things not to go quite so smoothly is equally large. This is why Wedding Insurance is so popular. But just what is wedding insurance? What does it actually cover?

 

weddingLike all insurance, wedding insurance cover is a contract agreement
where, in return for a stated payment, an insurance company will compensate for a loss. This can be of physical property, such as the rings; or a loss of a service, such as the photographer not making an appearance. However, the actual cover, or more importantly, the exclusions of cover need to be looked at and understood before handing over the premium. And, as ever, lots of questions need to be asked!

 

One of the benefits of wedding insurance is that it is designed to bring all the possible perils inherent in arranging a wedding under one insurance product. Annoyingly, this can also be a source of problems as well.

I have referred to the issues associated with “dual insurance” before. It is the principle whereby in the event of a claim you are obliged to disclose whether or not another insurance may exist that would also cover the claim. While it shouldn’t in itself prevent settlement of the claim, it can slow the process down and even highlight the possibility that you have paid a second time for insurance you didn’t actually need.

Let me give an example…

Most home insurance policies allow for an increased sum assured during the run up to a wedding, this is to take into account any gifts that may be stored at the house prior to the ceremony. A stand alone wedding insurance will also have a section relating to gifts. Dual insurance is almost inevitable.

Whether or not wedding Insurance is for you, is a decision for you, but hopefully you will be in a much better position to make an informed decision after you have read this.


WHEN DOES THE INSURANCE ACTUALLY START?

Most Wedding Insurance providers will state that you should take out wedding-rings-150300_960_720cover as early as possible. However, some state a time limit prior to the wedding of, typically, two years. It is likely that if you have already made arrangements outside of any set limits then cover will actually be activated from the day the insurance is taken out.

WHEN DOES THE INSURANCE FINISH?

Not as straightforward as you would think. The policy doesn’t end at the stroke of midnight on the wedding day. You may not know that there is a problem with the photographs for some weeks after the event. Make sure you check how long the cover is in force for and the time limits imposed for making a claim.

AM I COVERED IF ONE OF US CHANGES OUR MIND ABOUT GETTING MARRIED?

I don’t think anyone will be surprised that the answer to this is “No”. It does give rise to one of my favourite insurance exclusion phrases though, the “disinclination to marry” clause!

WHAT IF THE WEDDING IS CANCELLED DUE TO ILLNESS OR DEATH?

The fear of cancellation following an unexpected event is probably the biggest reason for taking insurance. There are a number of reasons a wedding may be cancelled, one of the most common being injury, illness or death. Cover in this instance typically includes the bride and groom (or prospective civil partners) and close relatives as well as significant members of the wedding party whose “unavailability” would make it inappropriate to go ahead.

While this deliberate vagueness is really helpful in many ways, as it allows for the inclusion of your closest childhood friend with whom you have been inseparable forever, the onus falls entirely on you to make the case for their non attendance being the reason for cancellation.

It is common for there to be an exclusion for “pre existing conditions”. This is very important if you have a close family member who has had poor health.

I would guess that in most families, someone has suffered a serious illness, and where this is the case I would suggest you do the following: Firstly, talk to the person involved. Ask them what their feelings are if they suffer a relapse and cannot attend, then throw in your own thoughts about how you would feel. Secondly, contact the prospective insurance provider and explain the situation. Be prepared to obtain a doctors letter setting out the situation and possibly even providing an opinion on the suitability of attending. It may well be that you are told that cover will not be extended to that person, but at least you will know and can be prepared for the worse.

With regard to “pre existing conditions”, check out what the insurance company’s definition of what they are. If for instance, the Bride’s Father had had a heart attack 20 years ago, not on medication currently and has another heart attack a week before the wedding, I personally think it unlikely that they could invoke the “pre existing condition” clause. Generally speaking, if you have a doubt – Ask First!

WHAT ABOUT COVER FOR FAILURE OF SUPPLIERS?

weddingThe simple answer here is that failure of suppliers is something that wedding insurance will cover to some degree, including deposits and the cost of sourcing alternatives at short notice. There is a more complicated answer, so here goes…

The list of suppliers and service providers for any wedding is long. Typically, it will include the venue, photographer, cars, entertainment, cake, flowers, suit hire, caterers and hairdressers. I’m sure you can add a lot more. However, the points I am making here are general points that are the same regardless of the service being provided.

Above anything else, get an agreement with every supplier.

Then read the agreement with every supplier.

Then ask for anything you are unsure about to be clarified – in writing.

Although a Wedding Insurance policy will state the cover that is in place for the failure of goods and services, the fact is you will have difficulties with a potential claim if there was not a written agreement, contract, letter of terms and conditions with a supplier. In real terms this means that if you have asked your uncle Bert, who is a great amateur photographer, to be your wedding photographer, and he doesn’t turn up resulting in you having to pay top dollar for an instant professional replacement; you may well have problems with the claim. So, even if you are using uncle Bert, get an agreement as to what is expected from him.

Most professionals will have standard terms of business and agreements which they will provide to you. They will set out the services they provide and may have a section on the limits of their liability if things go wrong. They will (or should) also have there own insurers who, in the event of a claim will also provide compensation for any problems you may have as a result of a problem caused by the failure of their client.

I would also suggest that you consider paying for your suppliers using a credit card. Under section 75 of the Consumer Credit Act, the card provider can be equally liable under certain circumstances for refunding your payment in the event of contractual failure. I am not usually a great fan of credit cards, but it does provide a further layer of protection and, given the range of interest free and cashback cards available, using one might be of use for other reasons as well.

If you find yourself in the unfortunate position of making a claim, as well as informing your stand alone Wedding Insurer of the relevant incident, also tell them if you paid by credit card, give them a copy of the agreement with the supplier, tell them of any other insurance cover that may be in force such as your home insurance. Remember, the purpose of insurance is to put you back in the position you were (as far as is possible) before the incident that gave rise to the claim. It is not to put you in a financially better position.

IS THE STAG AND HEN PARTY COVERED?

Almost certainly not. If you feel the need to insure this, there are stand alone “Event” insurances that may well do the trick. Usually though, exclusions include incidents that may occur “whilst under the influence of alcohol”. I’ll leave you to decide whether that makes it worthwhile or not!

IS THE HONEYMOON COVERED?

Again, almost certainly not. You will have to take appropriate travelwedding-rings-150300_960_720 insurance, as you would for any trip abroad, in order to be covered properly.

WHAT IF I AM GETTING MARRIED ABROAD?

Most Wedding Insurance providers provide for weddings abroad. Conditions are slightly different and, as always should be read closely. Some have restrictions on location, with USA and Canada frequently singled out for special attention, or even exclusion. You will almost certainly need to have your own separate Travel Insurance as well, although some providers may wrap up the two different policies into one package.

AM I COVERED IF ANYTHING IS STOLEN?

Yes…and no.

If anything to do with the wedding is stolen, such as gifts or the rings, you are probably covered depending on where it was stolen from. If it is from home, you are covered probably by both the Wedding Insurance and your Home Insurance, subject to your normal terms and conditions. If it is from a car, then the car would have to be locked and the items not visible from the outside. If it is from the reception then cover is excluded if it was stolen by someone that was invited to the wedding. As always, the full list of exclusions are listed in the various policy summaries.

I AM USING A WEDDING PLANNER, DO I NEED WEDDING INSURANCE?

Like any other professional, a wedding planner will have a contract setting out what services they will and will not provide. Typically, stand alone Wedding Insurance will not cover the services arranged by a wedding planner, so if you are using one make sure you know what the insurance position is regarding them.

WILL THE POLICY COVER ME IF THE WEDDING AND THE RECEPTION ARE ON DIFFERENT DATES?

Usually yes, though there may be a time limit on how far apart they are.

HOW MUCH SHALL I INSURE MY WEDDING FOR?

wedding-rings-150300_960_720Most providers offer different levels of cover at different prices. The simplest way to decide the right cover is to make a list of all the costs involved and then choose the level closest to the total cost.

 

Wedding Insurance, like all insurance can be of great benefit for the right people in the right circumstances. Your decision should be based on cost and the potential benefit to you after taking into account what, if any, cover you have already.



What Is Bicycle Insurance?

Anyone that has had the slightest connection with a road with cannot fail to have noticed the rise in popularity of cycling. In line with that popularity has been the interest in insurance specifically aimed at cyclists, but just what is bicycle insurance? and is cheap bike insurance, or even free bike insurance as good as the more expensive options.

Me. 0 to 60. (Not mph...)
Me. 0 to 60. (Not mph…)

Like any other insurance it is a policy that aims to protect you against the standard perils of theft, damage and liability plus, in many cases, some optional extras such as personal accident. However, there are a few things to both consider and be aware of before you take out a policy. Oh.. and as usual – there are a few questions you should ask.

If you have Home Insurance, it is almost certain that some degree of cover for your bicycle is included in your policy, equally certain is the option to add bicycle cover as an enhanced option to the policy as well. So the first question to ask is:

What cover do I already have – or could have – in my existing home insurance policy?

From a cost point of view, this will be the cheapest option. However, as with everything in life, you get what you pay for and you may find the cover to be a bit basic for your needs. If you have a bicycle that you use every now and then, worth under £200 and its kept in a locked garage for 90% of the time, it may be that the existing home policy which might offer cover for theft from a locked garage and some personal liability cover is sufficient for your needs. If on the other hand, you have a bicycle worth about £1500 and you use it every day and lock it up at the local railway station while you are at work, you may want to look a little deeper into the cover that you want.
So, now you’ve checked your existing cover and decided that you want something more tailored for your needs. What do you need to ask? Well, firstly:

Where do you want your bike to be covered?

There can be a number of answers here. Theft cover whilst it is at your home is a given, but what of other situations. Do you use your bicycle for commuting? If so, where is it kept while you are at work? Do you leave it at a railway station? A policy may have a time limit for how long you can leave it locked up away from home.. Do you take your bicycle on holiday or even abroad? If you do, what cover is in place while it is attached to your car? What cover exists while you are abroad? What about if you are away at university for a lot of the year? The chances are that the normal household cover won’t cover your cycle while you are away, and even if it does, the cover may be modified.

What do you want covered?

bikeWell yes, there’s the bicycle of course, but what about the accessories? What about the liability cover? Would you get a temporary replacement while yours is being repaired? You need to see what is included as standard and what you can add as extra cover if you need to. You also need to go back to your home insurance policy and see what the limits and conditions are for the liability section that will be included in that, then you can compare it with the liability limits available on a stand alone bicycle policy.

How will your claim be settled?

There are two ways a claim can be settled; New for Old and Indemnity. With a New for Old settlement if you bicycle is stolen, it will be replaced (or the replacement cost given) with a new equivalent bicycle. On the indemnity basis, a cash settlement will be given based on the replacement cost of an equivalent model LESS an amount for wear and tear and taking the age of the bicycle into account. You need to establish which is to be used, or whether it will be a combination of the two, where a New for Old basis is used for bicycles up to a certain age after which it becomes an indemnity basis.

Do you want any Personal Accident cover?

Probably the least entertaining read of any insurance policy. The Personal Accident section will have a grim list of situations that will result in a payment, including Death, Loss of Limb(s) and Permanent Disability. It is, however, important to read as the circumstances in which payment will be made is quite specific and varies from policy to policy. A valid claim, for instance, may be for the loss of a hand but not a finger or fingers. As with everything I point out in these blogs, I am not suggesting that one type of cover is better than another. I am saying check the cover and decide yourself whether it suits your purpose. The time to find out the details is not when you are arguing with an insurer about what cover you thought you had.

A few general points…

All policies have exclusions, these are conditions that are set out in the policy where the reasons a claim will not be settled. They vary from policy to policy and you should read them carefully. There are a couple of universal truths though. Just like car insurance, claims will always be declined if you are doing anything illegal whilst in control of your bicycle. Typical examples will include riding under the influence of alcohol or drugs or using it as a getaway vehicle after a robbery (which is not recommended for a variety of reasons!) Most insurers will exclude cover if you are taking part in a competition. Generally speaking a competition is defined as an event where there will be a winner. This means that rallies and charity events are usually accepted, but don’t take my word for it – read, check, and ask.

Security

Other exclusions may include the fact that cover is not in force if the bicycle is not secured by an approved style of lock. Check your policy wording for what is and isn’t acceptable and look at the specifications on a lock before you buy it to make sure it is compatible. A huge range of locks for all purposes and budgets can be found here While on the subject of security, it is a good idea to security mark your bike with a  UV pen
as you would with any of your valuable property. I would suggest you taking a picture of it as well. Receipts and the date of purchase should also be kept safe and ready to be made available when asked.

Dual Insurance

This type of insurance increases your chances of falling into the “Dual Insurance Trap” This occurs when the same risk can be covered by two separate policies, usually from two different providers. When you submit any claim, the insurer will ask if you have any other insurances that may cover the incident that you are claiming for. You must tell them if you think you may be covered with another policy. It is then down to them to talk to each other and establish who takes responsibility for the claim, or if they share the settlement between them. With cycle insurance, there is a possibility that your home insurance may also cover you bicycle’s theft if it was stolen from home even if it is specified on a stand alone cycle policy. The same could be said of a travel insurance providing dual cover if you have taken your bicycle abroad. As with all dealings with insurers, tell them exactly whats what and work with them to get clarity on any questions you have.


Planning to Avoid a Below Average Retirement Income

I read an article this morning titled:

Women twice as likely as men to be unaware of pension value – Fidelity

You can read the full piece here, but in summary it was saying that some 25% of women do not know the size of their pension pot compared to just 15% of men. It when on to say that 25% of women found the planning process difficult compared with only 16% of men. It did not say whether it was the same 25% that both found it difficult and didn’t know the size of the pot. Students of the science of probability will no doubt bring me up to speed on that. These statistics point toward an increase chance of ending up with a below average retirement income. More worryingly, 21% said they would seek advice on their retirement income from friends and family rather than a qualified practitioner. Getting financial advice from friends and family is a recipe for putting those relationships under some potential strain. If, for no other reason than you can pursue a complaint against a qualified adviser, but there’s no redress against a well meaning cousin, always get an answer to a question or advice on a pension, in writing and from a qualified and regulated practitioner.

Whilst I recognise the disparity between the genders, the fact remains that as a whole too few people are making provision for retirement. When I was actively working in the pension sector, the overwhelming reason that people gave for not putting money aside, was the simple fact that the budget was just not available to do so. There is no simple answer to that problem, although a budgeting technique that many used was to treat their regular pension savings as if it was a bill that had to be paid.

Whilst reading the article, I was reminded of a poem by Robert Frost in which he says

“The afternoon knows what the morning never suspected”. 

Just like the afternoon can’t go back to the morning to change anything, we cannot go back a few years to alter our retirement plans. It is one subject for which the phrase “cannot start too soon” makes absolute sense. But before you can even consider altering plans, you need to find out where you stand now.

                   Today.

                                    This minute.

 

In my previous post “Do You Know Your State Retirement Age” I provided the links for both getting your date of retirement and your State Pension Forecast. Finding out you current situation from private or company schemes takes a little more effort than using the government calculators, but not that much more, and is well worth it in the long run.

Here is a quick four step guide for  finding out where you stand pension wise at this moment.

Step 1

Get a State Pension Forecast using the government calculator

Step 2

If you work for a company that provides pension provision, find the most recent pension statement that you would have been sent. Most would have been sent this time of year. If you haven’t got one, contact your employer and ask for it. They must provide you with one by law. Once you have it, read it. If there is anything, and I mean anything, that you do not understand, write it down and ask them.

Step 3

Write down all the places where you have worked. Some you will know straight away whether or not there was a pension benefit there or not. If there was, have you got a statement from them. If you have moved house, it is quite possible that they do not have your current address. If you haven’t got a statement, or the one you can find is quite old, write to the employer and ask for one.

When you write asking for a statement, address it to the HR department (or equivalent) and mark the envelope “Staff Pension Enquiry”. It is more likely to get to the right person if you do. In the letter you need to include the following:

  • Your Name
  • Your current address
  • Your address at the time you were working there
  • The dates (approximate if necessary) that you worked there
  • Your Date of Birth
  • Your National Insurance Number

Step 4

Once you have got all of these together. Add them up. This should give you a basic idea of the amount you are likely to get. It is probable that the pensions will be of differing styles and the calculation of each maybe slightly different, so it can be safely said that the resulting figure is not going to be exactly accurate, but it will be close enough for you to start thinking about what you might need to do to get the income you want in retirement.

It is at this point that you can decide whether it is worthwhile approaching a IFA for advice on how to make the best of what you have. All IFA’s will initially talk to you for free and will say whether its worth paying for professional advice or not regarding your ongoing planning strategy.

Figures obtained by the Prudential indicate that one person in seven will retire this year without any additional pension other than the state pension. The vast majority of the remainder will experience a shortfall in income from what they are expecting. Regardless of your age or gender, there is no better time than now for starting the planning for your retirement.

Do you know your State Pension Age?

…Or for that matter, how to get your State Pension Forecast?

As with most things in life, a little advanced planning can make things a whole lot easier. Retirement, hopefully, will come to us all and the pro of not doing the 9 to 5 or equivalent, is balanced by con of the major changes in your income. And they are not usually for the better!

The earlier you can start to have an idea of both when you are going to get a State Pension and how much it will be, the better chance you have of making that major change in your life a little easier.

During my lifetime both the date of my retirement and the amount forecast, have changed regularly. It is safe to say that the younger you are, the more chance there is that the rules will change, and change again before you retire. The only way to deal with this is by frequently checking the available forecasts as you go through your working life and as you get closer to that State Retirement date the information can be regarded as being more accurate for you. Fortunately, the government provide a simple instant online calculator for working out your State Retirement age. You can go straight to it by clicking here and then follow the steps below.

Step by Step Guide on how you can find your State Retirement Age





You will notice that along with the Retirement Age, the results page will also ask if you want to follow links for both information about Pension Credit and how to get a State Pension Forecast.  Both are similar in layout to the State Retirement Calculator shown above. As the State Pension Forecast is personal, you will have to log in using your Government Gateway account. You may well use the Government Gateway account for filing your tax return, or perhaps accessing other services. If you do not have one, you can register here.

 

The Cost of Underinsurance and the “Average Clause”

Most people understand that when taking insurance a “sum insured” will be needed for the policy to make any sense. It is the amount you decide is the cost of replacement of the house, contents, specific item, in fact anything that is subject to the policy. It is the figure on which the premium you pay is partly based and is the figure that the insurance company will depend upon in its calculations of the claim. But what if you get the figure wrong? And, just what is the “under insurance calculation” that is used? In the event of a claim not being paid out in full, the insurance company will often cite their application of an “Average clause”, but, in insurance, what is an “Average Clause”?

The “Average Clause”

Most, but not all, insurance companies will have this in their policy terms and conditions. It is the calculation that they will using in offering the settlement figure on a claim when they believe the sum insured (provided by you) does not reflect the true value of the property or item that has been lost or damaged. Obviously, this only works when the true value is greater than the stated sum insured. You’re not going to get your claim increased if you accidentally “Over insure”!

Here’s an example.


In this simple example of a buildings insurance that has a true replacement value of £200k, but has been insured for just £100k it shows that the likely payout of the claim will be £50k. Any excess on the policy will then be taken off the final figure of £50k, so what you will actually receive will be even less.

The principle applied here is actually quite simple: The actual value was £200k at the time of loss, the sum insured was £100k. The sum insured is therefore 50% of what it actually should have been. As this event is deemed to be 50% underinsured, then the offer of settlement will be 50% of the given sum insured.

The formula is a constant. If, using a sum insured of £150k in the above example instead, the settlement offer would be £75k as the underinsurance would be 25%.

It’s Your Responsibility…

When it comes to setting the sum insured on a policy, whether it be domestic or business, it is down to you to get the sums insured correct. Even if you use a broker that is regulated to give advice, that broker must not guide you as to what sum insured should be on the policy. As far as property is concerned, only a suitably qualified surveyor can give an accurate rebuild cost for the purpose of insurance. A good working alternative getting a surveyor out to do such a valuation is to use the Royal Institute of Chartered Surveyors online rebuild calculator which can be accessed by clicking here If you are insuring a property for the first time after buying it on a mortgage, then a minimum sum insured will be included in your mortgage survey.

With regard to everything other that property values, it is very much down to you to estimate as best you can what it would cost to replace your entire contents of your business or home. Talking about how to do this can, and probably will, justify a post all of its own sometime in the future, but here are my top five tips for getting the sum insured figure as good as you can:

  1. Don’t just tot up the value of major items such as TV’s, furniture and kitchen appliances. Its the smaller items such as soft furnishings, games/DVD’s, garage or shed contents, pots and saucepans that collectively add up.
  2. Scan or photograph receipts of purchases of about £50. It really only takes a minute to do. Keep them all in a file and email it to your self each time you add to it.
  3. Walk around the house or business and take a photograph of each room. In the event of a major disaster like a fire or flood, you can just email the pictures to the loss adjuster or insurer and say “this is what the place was like before”
  4. Get valuations and photos of any items you specify, especially jewellery.
  5. Got a hobby or pastime? Just because its something you regard as an everyday item, don’t forget whatever it is can be costly to replace.

Not all policies have an “average clause” but the vast majority will. My working practice was to automatically query it whenever it was applied. A lot of the time a degree of “flexibility” was then introduced into the proceedings. If you find that it is being applied to your claim, always question it. If you are still not happy, ultimately there is the Ombudsman that can be approached. However remember…

It is your responsibility to get the sums insured correct- not the insurer or broker.



Make Friends With Data Protection

I have, on occasion, been accused of being a little impatient. I like to pick up the phone, ask a question, get an answer, say a cheery goodbye and move on with my day. The reality is that after being kept on hold listening to music, or being told that my call is important, or better still, playing “hunt the option”, a human will say hello. It is then their job to establish that they are talking to the right person, usually through the use of “security questions”. It can seem all a bit inconvenient, especially as I have heard it done quite badly over the years.

Ultimately, data protection is there for all our safety. There is an ever increasing chance that any of us may fall victim to identity theft or some other cyber crime. But what if we are trying to help someone else by calling on their behalf? If the data protection rules are being adhered to  properly, you will be politely told to go away and get the account or policy holders permission before they can talk to you. This is where everyone can help themselves with a little planning. All you have to do is let a company know who they can talk to.

Take the example of a couple living together in a house. They decide to take out house insurance and it is left to one of them to make the arrangements. They go online, or fill out forms and, in the absence of the other partner, just go ahead with their own details. It does, I assure you, happen a lot. Move forward some time and a claim arises. The partner who was not involved in the setting up of the plan calls to get the ball rolling and immediately is told that as they are not the policyholder, no information can be exchanged with them.

Another example, a little closer to my own situation. An elderly relative, living on their own, goes into hospital for a short while. During which time I am called upon to deal with some routine matters. Arrangements have been put in place for me to talk to some places, but others I came across for the first time and they, quite correctly, refuse to deal with me.

There is justification  for everyone letting the companies and organisations they deal with know who it is ok to talk to if you’re not around. All you have to do is let them know with a letter or email, who has permission to talk on your behalf if you are unwell, away or just simply unavailable. Don’t forget to give them the persons contact details as well because the company might be having difficulty contacting you.

Who should you tell?

In short, everyone you have dealings with, either as a client or service user. The list could go on and on, but typically would include:

  • Insurance Companies

  • Bank & Building Societies
  • PensionProviders
  • Local Authorities
  • Doctors
  • Utility Providers

 

Here’s a sample letter you can send:

And here’s a link if you would like to download and use it. Letter of Authority You can amend it to suit the situation, but make sure you include the full details of who you are giving authority to and remeber that it must be dated.  As you can see, it’ need only be short and to the point but sending such an authority can save a whole lot of hassle.

What Does An Insurance Broker Do?

F-questionI chose the title of this blog in order to keep things as broad as possible. However, I did consider other titles such as:

What Does an Insurance Broker Do, and Why should You Use One…Or Not

or

What Should You Expect From Your Insurance Broker?

 

You will notice how I have now cleverly incorporated all the titles I couldn’t decide between! The truth is, they are all good questions and I will try to do them all justice.

 

In short, a broker acts on your behalf in order to find the best policy to meet your needs.

Lets break that down a bit…

 

“Acts on your behalf”

This is true. By using a broker, you are effectively appointing them as your representative in all matters to do with the product you are buying or researching. The broker will also act on behalf of the Insurer in certain regards. These are in the main administrative, such as the authority to issue documents or administer the payment process.

There is also an obligation on the part of the broker to make the insurer aware of anything that may affect the insurers decision to hold cover. This means passing on as much information as possible to the insurer, and it is this element that sometimes I have been questioned about over the years.

The situation is actually quite simple. If all relevant information is given to an insurer, and after consideration they proceed with the policy, then everyone can comfortably go ahead with their lives knowing that in the event of a claim the insurance company has been in receipt of the full facts and the claim should be handled quickly and efficiently.

If, on the other hand, not all the relevant information has been passed on, then you can expect the claim to be subject to further scrutiny which, at best will slow things down. I should make it clear that is is now normal practice for insurance companies to distinguish between those cases where information has genuinely been omitted due to human oversight, and those where information has been deliberately concealed in order to obtain cover that otherwise would not have been granted.

Where a genuine oversight has occurred, I have always known things to be sorted out amicably. Unfortunately, there are people out there who don’t do things properly and with bad intent. In those cases the insurance company can cancel the policy as if it had never existed, and ultimately, in certain circumstances prosecute for attempted fraud.

 

A good broker should take the time to get all the information they need from you, and then present it in such a way that the insurer can make a quick decision.

 

“Find the best policy”

A broker will always try to find the best policy to match your circumstances. Wherever I have worked, I have never experienced anything other that the overwhelming desire to “do what’s best for the client”. However, the plain truth is that brokers do not have access to every product and I cannot see how anyone can categorically say that the policy being recommended is the best one.

It may well be the best one from those that broker has access to, but the current marketplace means that no one can actually choose from all the available products and providers. A lot of products are now only available online, or through specific high street channels such as banks and supermarkets, none of these will be available through a broker.

Typically, a broker will have agencies with a number of insurers. Not all insurers will grant a broker an agency. That’s not to say there is anything wrong with that broker, it may be that the insurer wants to insist on receiving a minimum amount of business that cannot be provided. It may be that the insurer feels it has enough brokers promoting their products in that area. It may be a number of reasons which in honesty do not matter. The point is that a broker can search the market for you, but the market being searched does not, and never will, include all the options.

With the rise in popularity of online brokers or “comparison sites” as they are more often called, it is becoming very difficult to justify using a traditional broker for the more straightforward car, home and travel insurances. A good broker will offer advice in these areas, however, given the rewards to the broker being offered for selling these products, especially the low levels of commission being offered for car insurance, it is just not cost effective to be active in that marketplace.

 

“Meet your needs”

I guess you wouldn’t like to be called “demanding” or “needy”. Yet, as far as insurance is concerned, you are, and here’s why; in order for you to be given a policy, you will, at the very beginning, be asked a number of questions, this can be verbally or online, even on paper and this can be in person with a broker who is able to advise you, or completely automated. The initial purpose of this questioning is the establishment of a “Demands and Needs” statement.

This is a document in which you state what it is you actually want. It will include sums assured, particular items to be included, in fact everything that you want a policy to cover. The broker or insurer then uses that as the basis of the product you will be shown. If there is anything on your “demands and needs” list that cannot be met, then this has to be pointed out to you. A copy of the “Demands and Needs” statement should always be included in the brokers paperwork that is sent to you. Read it. Make sure it is what you want, because if it is missing something there is a chance it may not be included in your policy.

 

Should I use a Broker?

It is very difficult to say that a broker is the best route for straightforward Home, Car and Travel insurance any more. Even in my final years in the business, I was using comparison sites and tellingly, so were my colleagues. Even some of the small business insurance is becoming more appropriate to find online. as long as you read everything that you are being asked to, then the non-traditional-broker option is both keenly priced and nowadays almost always supported by a 24/7 service.

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