However, it is also important to challenge your own assumptions of what you might expect to happen if you need to make a claim in any type of insurance risk area. You may presume that you know what you will be covered for, but as we are about to find out, there are a lot of myths in the world of insurance and it pays to make sure you have accurate information.
So, let's take a look at and de-bunk some of the more common insurance myths.
Car insurance
Your car's value
If your car or other vehicle is written off in an accident or stolen you will not receive the market price for the value of your vehicle if purchased new. The insurer will only pay you the amount it costs to buy a replacement vehicle of the same age. This is because the car will have depreciated in value.
Driving abroad
If you have fully comprehensive insurance on your vehicle in the UK, it does not necessarily mean that you are fully insured when you drive abroad in your own vehicle. You need to call your insurer to check and arrange additional cover if necessary to arrange foreign use cover.
If you drive a hire car when travelling abroad, make sure that you purchase the right insurance as part of the package you purchase from the hire car company.
Rising administration fees
Car insurance companies are generally charging higher administration fees for services that you might imagine come as standard such as fees for renewal, cancellation, set-up and duplicate documents.
When you negotiate your car insurance policy it is worth questioning this and attempting to negotiate lower fees. Also, make sure that you read the terms and conditions of your policy carefully to avoid extra fees, don't just assume the insurance company is right.
Use the myfinances.co.uk comparison site to find the best deal on car insurance.
Home Insurance
Accidental damage
Most standard home insurance policies will not cover you for accidental damage to expensive equipment in your own home. This may seem hard to believe as it would seem logical for accidental damage to be included in any contents insurance policy, but in most instances you will have to pay for additional cover.
Extended absence away from your property
Many people think that unless you are away from your home for more than a month you don't have to worry about whether the absence invalidates your home insurance policy. It varies with the policy and sometimes the limit on the amount of time you can be away can be less than a month and on other policies it is more. As always, check your own policy to make sure you know what the limit is.
Single-item limits
Don't assume that very expensive individual items will automatically be covered by your home contents insurance policy. The limit on single items is usually around £1,500 but this varies so you need to check your policy to see what the limit is. If you have items that are worth more than the limit and you don't already have separate insurance for them, you need to speak to your insurer and get them covered separately otherwise your insurer won't pay out for them in the event of loss, damage or theft.
You should insure your home for its full market value
You don't need to insure your home for the full market value. You only need to get buildings insurance cover for the cost of re-building it. This will almost certainly be lower than the market value, unless you live in an unusual type of home or a period property.
Use the myfinances.co.uk comparison site to find the best deal on home insurance.
General insurance myths
Your insurance will cover acts of god
The definition of an 'act of god' is clearly going to be open to interpretation, so if you check with a dozen different insurers over an unusual type of claim you will be likely to get several different answers. Because as policyholders none of us can accurately predict our risk in regard to an act of god as policyholders there are few strategies for mitigating the risk.
However, you need to be aware that you may not automatically be covered for an act of god. The ash crisis last April that closed airspace and caused such disruption is a good example. Some insurers paid out to passengers who missed flights because they were covered through policy features related to bad weather conditions, other insurers interpreted it differently and didn't pay out to policyholders.
You can claim as often as you like
You might think that if you pay high premiums every year you ought to be getting something back for the cost and attempt to claim for any damage to your car or home or loss of valuables, no matter how minor.
Be aware though, that if you make three claims on a policy within three years, you will find it difficult to get any company to insure you and if you do, you will be paying back the money in high insurance premium costs over the next few years.
Use the myfinances.co.uk comparison site to find the best deal on insurance.
Life insurance
Employer life insurance is enough
A lot of companies offer life insurance as a benefit of employment but it is important to check that the policy you are covered under gives you the right level of cover for the individual needs of your family.
Employer life insurance policies are often general basic policies, and although a good perk, they may not give you the benefits you would expect or your family would require in the event that you needed to claim on the insurance. You may need to top this policy up with an additional one that gives you more product features.
Only the wage-earner needs life insurance
A common assumption is that only the main breadwinner needs to be covered so that if they died, their earnings would be covered through a life insurance policy.
However, if you have a family and something happened to the main carer of the children, then provision would be needed to take on the care of children and the house, usually through childcare costs and perhaps some additional help with the cooking and cleaning. These costs need to be considered when assessing what life insurance cover is needed for a family as a whole.
Use the myfinances.co.uk comparison site to find the best deal on insurance.
Travel insurance
Standard travel insurance covers skiing
This is a common misconception and applies to other winter sports and extreme sports. A standard travel insurance policy is very unlikely to give you the appropriate cover for skiing, snowboarding or any other sport deemed by the insurers to be of a higher risk.
Check your policy and get additional cover for any activities not covered through the standard travel insurance policy.
Health insurance
My claim will be rejected if I have drunk any alcohol
If you have been drinking heavily and suffered an accident that would be deemed unlikely to happen if alcohol was not involved in the incident you will probably not be covered (though it is still worth checking). However, if you have had a glass of wine at dinner and someone has swiped your phone or iPod from the table, the alcohol will not be taken into consideration when your claim is being assessed.
Use the myfinances.co.uk comparison site to find the best deal on travel and medical insurance.
www.myfinances.co.uk
0 comments:
Post a Comment