Features : Motor insurance – getting to know you

AROnline’s very own insurance expert and man in the industry, Mark Mastrototaro, explains how insurance works, and why it sometimes seems unfair when your policy renewal comes in and it’s not as little as you’d expect.

He joins the team to answer your insurance questions. Read, digest and get ready with your questions!

Frequently asked questions about your premiums

Even the best of us can be caught out sometimes. (Picture: NW54 London)

Motor Insurance; without doubt one of the elements of driving that attracts a good feeling of resentment. Yes it’s a running cost, like fuel, tyres, etc etc, but unlike these thinks, most of us pay for 12 months of something invisible, which is where, I believe the psychological angst we have towards Insurance and Insurers stems from.  We see the tyres we buy, we see the fuel gauge creep up, but with Insurance, all we get is that letter, a few days after shelling out a tidy sum of money.  Perhaps if we were provided with a translucent inflatable bubble to wrap the car in we’d feel better…. Perhaps.

There are many feelings and misconceptions aimed towards Insurance; ‘I’ve paid £xxxx.xx amount of the years and never claimed”, ‘I’m paying more than the car’s worth”, ‘It should be cheaper, it’s a smaller engine than the one I’ve had previously”. The list literally is endless, a problem which is not aided by the relative naivety of the consumers of insurance; for such an expensive product, which is widely consumed by the UK population, there is a frightening lack of understanding of even the basic principles of Motor Insurance.

We all know someone or perhaps even feel it personally, that we have been ‘ripped off’ or that insurance is a ‘scam’, whilst it cannot be denied that there are price differences between insurers and underwriters, to call such differences a ‘rip off’ is unfair; Insurers do not just pick a price from thin air, they ask questions which give them the facts they need to identify risk.

It basically translates to ; What is it (the Car), Who will drive it (Driver Details), What will it be used for and When (Mileage, Class of use, Commuting etc), Where will it be (Area kept, Area you live), Cover Type (Comp/Third Party F&T/TPO), What’s your insurance history like? (No Claims Discount, Claims experience).

They have historical data going back years, with their own claims experience also, highlighting the finest detail and the risk posed by such detail, this enables them to make a judgement on areas such as; (I’m not including everything here!)

  • The vehicle itself;
    • Claims history of the individual car – sometimes as far down as trim level -have they paid out for them being stolen, being vandalised, being in an accident.
      • If so, the repair costs, the repair timescale (as this affects the cost of providing a courtesy car in the long term)
    • Modifications
    • The value – although most insurers will pay market value only, not what you paid for the car; not top book price and not your own valuation; the information is captured usually to determine if any additional security requirements are applicable. It also enables the insurer to use their system to load or discount as a result of a valuation and there are also Insurers who don’t offer cover on vehicles above or below a certain value.
    • The age of the car – Again, the systems will load or discount based on the age of a vehicle, this can be particularly important when insuring a brand new car as it can trigger the insurers system to include features like ‘New Car Replacement’ (which is when, if you are the first owner of a vehicle and it is below 12 months old, rather than paying out for a total loss (write off) the insurer will simply provide you with a new car instead).
    • How long vehicle owned for. This seems a silly question and I only know of a few insurers who actually use this as a rating factor, The rationale behind it does make sense though, if you are familiar with a car, then you should be better at driving it than when you jump in a different size/powered car.
  •  The Driver;
    • Age – Broken down by years and claims experience of the Insurer of drivers within those years
    • Licence Held – Both the type of licence (i.e Provisional/Full and where it was issued)
    • Occupation – various occupations are higher rated because of the Loss of Earnings element for any passengers being carried which can be very high.  Likewise being unemployed tends to be higher rated for varying reasons, as too does Student – living away from home.
    • Claims experience – self explanatory, if you have a history of making a claim which was not the fault of another driver, it stands to reason you are a higher risk than someone who has not.  Some insurers also capture the information as to the value of payouts, which can affect price or even if cover is offered at all.
    • Motoring Convictions – Again, as with claims, this is self explanatory. Some insurers capture the amount of points received for a specific conviction and also the level of fine received, and can load/decline cover based on the information.
  • Vehicle Usage
    • Who will use it? Many insurers give a discount for Insured and Spouse policies. This isn’t unfair, it’s simply that they have had a better claims experience from that. Some also give a discount for having an older driver on their (but usually only if related).
    • Mileage. Approximate annual mileage. This is just an approximation and there are few insurers who will penalise you in the event of a claim for getting this slightly wrong (ie less than 1000 miles). The pricing does tend to go in either 1 or 2k increments for discounts or loadings on this. Again it stands to reason that if the car is out on the road doing more miles, the accident risk can be higher. (that doesn’t mean the price will be, as a particular insurer may determine the theft/vandalism risk of your particular car at your particular address to be higher!)
    • Class of use – Simple really, Social Domestic Pleasure, commuting, or Business use (there are different Business use classes depending on who needs to drive it).
  • Cover type
    • Comprehensive, Third Party Fire & Theft or Third Party Only – More and more insurers are now rating TPFT higher than Comprehensive, claims experience against policy type being the reason. Many insurers have stopped offering TPO cover at all.
    • A little known couple of extra covers are available form some insurers also, which remove road risk cover, these are called ADFT (Accidental damage, fire & theft) and FTO (Fire and theft only). These aren’t available from the start of the policy, but can be downgraded mid-term and are particularly useful if a car is being taken off the road and kept on a drive or in a garage, as they are still covered against malicious damage, theft or accidents. These are very low priced levels of cover and usually give a refund to the policy of up to 90%!
  • Where will it be kept
    • Postcode – The old favourite! Insurers now use the full postcode to rate risk of an address. They base their judgement on many factors; Claims for theft, claims for vandalism, claims for accidents and crime rates/areas of civil unrest etc.  You may have bought a nicer house in a nicer area BUT if 5 of the neighbours have all claimed for incidents at the address (hitting the gatepost, vandalism in the night etc etc) you could end up discovering the address is higher rated than you thought. These are regularly reviewed and can change monthly.
    • Drive, Garage, Street, Car Park etc – Not always clear cut, again if, in a particular area more claims have been made in garages than on drives, garages will be higher rated. Also – if your car is in a garage block, you must give the postcode of the garage block as the one where the vehicle is kept.
  • No claims discount
    • This is the overall discount applied once everything has been calculated. All insurers vary in terms of what a year = in terms of discount but it’s usually not far form the following;
      • 1yr – 30%
      • 2yr – 40%
      • 3yr – 50%
      • 4yr – 60%
      • 5yr – 60-65%

As I’ve said this isn’t exact but it’s usually around that. ‘Full’ no claims is usually at the 4th year and this is the point you will be offered the option to Protect your bonus.

    • Protected No claims is probably one of the most misunderstood elements of car insurance. The cost varies but is often between 12.5%-17.5% (but more often than not 15%).

Put simply; it does not protect your premium. It protects the level of discount you are entitled to at the end of the rating process. So if you have made a claim, it will have loaded the policy before your discount is applied. For example;

      • Say you’re entitled to 60% discount of a premium of say £1000.00 before you had a claim, you’d pay, £400.00.

If you have a claim and protect your bonus, you’ll be entitled to 60% still but the premium before bonus may now be £1500.00 so you’d pay £600.00

If you had a claim and didn’t protect your bonus, you’d be entitled to 40% usually (stepped back from 5 to 2 years but some companies vary) so it’d be 40% discounted from the £1500.00 meaning you’d pay £900.00

When you consider you’d pay 15% of the 400.00 originally to protect your bonus (£60.00); that spend of £60.00 could save you £300.00. You’re technically insuring your insurance.

Everything I’ve written is very much generic and peoples own individual experiences obviously speak for themselves. All I’ll say is, whatever reservations and bad feeling you have directed toward the Insurance market, just try to be a little more open-minded and consider what’s been written; remember, the Insurance companies aren’t charities, they’re not Government run and they have overheads like anyone else. You motor insurance isn’t a savings scheme that you’re ‘entitled’ to claim from as ‘you’ve paid enough over the years’ it’s more like a co-operative if anything. It’s a big pot we’re all paying into, to make sure people are protected and have some way of being protected, whether they’re at fault or not.

Keith Adams


  1. The market value bit seems like a bit of a ‘scam’, for want of a better word sometimes.

    I mean when you take out the insurance they ask you how much the car is worth, and you might say £10’000, there are various reasons why you might come to that figure. That’s then the amount you find written on your schedule. Yet it will usually say somewhere “this is a market value policy”.

    So they appear to charge you for your premium based on the car being worth £10’000, but if say it’s stolen and burnt out 2 weeks later they’ll only pay you out for ‘market value’ which might in their opinion be £5000.

    Obviously needlessly inflating what you think it’s worth when you get the quote will be your fault. So why do they ask for the value if they’re basically going to ignore what ever you tell them?

  2. I notice you mention motoring convictions, which is all fine and well. However, you fail to mention that non-motoring convictions can have a significant effect on insurance premiums. I am a decent driver, having never had an accident or made a claim, and having never had a single point on my license. However, an incident in a pub 4 years ago (which I deeply regret, and was very much a one-off) pushes my insurance quotes out of an affordable range. I know this is a case because I tested it by getting quotes with and without the conviction.

    So, because I have a conviction, am I suddenly a bad driver?

  3. The non-motoring conviction one is sometimes a bit of a bind, it can be a nightmare for people in your situation, especially when it’s something so ‘un-motoring’ related. Unfortunately it is simply a case of demography, in terms of, the insurer making a judgement call based it it’s previous experience. I’m speaking hypothetically here of course, but it could be, out of say 100 people they have insured who had convictions, perhaps a high proportion of them went on to either have accidents or make claims; as such that demographic becomes a ‘Hot-spot’ or black area.
    Alot of insurers, if you go to a broker at least – will take specific details of the conviction, including any sentence served etc, and converse with the underwriter directly, who have the authority to make a sensible decision based on the information provided (something that Mr Go Compare and that Meerkat are unable to do). I have had the cause, a number of times to do this and can only think of 1 occassion when cover was loaded and 1 when cover was declined and these were for VERY serious offences. You have to remember, the call-centres and internet sites are set up for very very run of the mill things usually and, for good reason, decline things outside that as the ‘human touch’ is needed.

  4. Excellent summary just one more thing.

    Different companies have different business models based around different profiles of customer. So how much they want you as a customer is a huge influence on your quote or even if you will get a quote.

  5. Just remember,material facts as well,one false move,one detail you failed to disclose or slipped your mind,your claim falls flat on its face.

  6. That’s correct obviously their business model is based around making money and getting the best risk on board, so ultimitely it is all down to claims experience, unless you go outside mainstream cover and start talking about specialists, which is a different ballpark altgother….

  7. It should stand to reason that if someone asks you a very specific question, you answer it correctly. If you don’t you are the victim of your own downfall unfortunately

  8. spoken like a true insurance man. a great article but im sorry but ur not going to get somone in the industry telling us what a bunch of scam artest insurance companys are, are u?
    i think the main reason (and this is no reflection on u personally mark mastro) that people see insurance companys as as the scum bags that they are is for the very reasons u gave. they do go into every minute detail about everything because they have a risk factor for everything and charge u acordingly. for example a type of person may have a certain job and watch there premiums go up because of it. yet the fact that one job sector has slightly more accidents than the other types of jobs might just be down to luck rather than being a certain type of person. which ultimatly brings me to my main point. what pisses me and most people off about insurance is the way its calculated. i understand that for a new driver u need a starting point as ur going in blind. so all those risk facters insurance companys use have there place. but as the years go by to still be judged by other peoples mistakes is simply a con. there is no excuse for putting my premiums up because i’m a pub landlord for example (im not btw) and they have more accidents when u have my own record going back 10 years telling u im not like that. that is a con pure and simple. that is what pisses me of about insurance companys and that is why they are hated so much. there is no reason unless im a new driver that i should be judged on other peoples actions. i personally have over 12 years driving experience and not once claimed for an accident, so when i get insured there is a good chance that they are going to get a load of my money for totally nothing! thats fine but how about being a bit humble about rather than trying to screw me and everyone else over further with even higher premiums? huh? (this is a general rant at insurance companys its not in anyway directed as an insult to the auther of this article)

  9. Very interesting article, and the bit about protected no claims is a bit of an eye-opener. I wonder how many people knew how that worked..

    I insure my cars through Direct \line, and all they ask now is if the value of the vehicle exceeds a particular figure (I think it’s £30K). Therefore my insurance schedule states that the value of our vehicles is “market value (not exceeding £xx,000)” wich I suppose covers all bases in terms of how much you will get and your limits in terms of what they will insure.

    The only question I have (based on my own policy example) is; if, say, a 4 year old Range Rover is considered to have a ‘market value’ of £29,000, yet I paid £36,000 for it – would my insurer accept the risk or decline it? Very hypothetical but I suppose for some drivers this could be where the valuation line could get a bit blurred. Unless I had access to their internal systems I would be unlikely to know what they deem to be the market value of any given car.

    Just a thought.

  10. @Paul T – good question. If the value was given to an insurer as £36k and they had a stipulation in their terms that they do not accpet vehicles of that value it would be declined at the outset; the system would be set up to do so. If however you had paid £29k for it and upon writing it off, it was discovered to be worth more, you would not be paid any more than the £29k you declared you paid for it. The reason being, there is a paragraph in Insurance law (I do not have my text-books to hand so forgive the specifics please) which states you cannot make commercial gain from an insurance payout; ie be placed in a BETTER financial position than you were pre-claim. This is the reason why, more recently insurers systems now include a field to capture ‘price paid’ as well as vehicle est value.
    Let’s not also forget that the market value figure of a car is very fluid and only really valid at the point of claim anyway! (unless as stated in the article, for reasons of being over/under a threshold)

  11. @Ryan – believe me, I understand your points completely, I have to have insurance myself too! You have to remember though, there really is no other way to rate a policy other than the soon to be trialed ‘black-box’ type method which will monitor YOUR driving habits/style etc and charge accordingly, I am not a subscriber to this as it just won’t work in my eyes, long term, any-who, look at it, if you wee a freelance insurer. Say someone comes up to you and says right, I’ll give you £300 if you’ll give me legal status to drive for 12 months, but, also, within that 12 months, If I hit anyone or anything, you’ll pay for ALL the damage as long as it costs less than £20 million. Now imagine how many questions you’d want to ask, imagine how many extra bits of info you’d compare it against. Insurers are bookmakers, it’s all a gamble based on form. I attended a large industry seminar 3 weeks ago and within were the comparisons of money in vs money out for some very big name insurers. It is literally eyewatering and no small coincidence that so many insurers are now merging to simply survive. If you can imagine having ‘Mr Noclaim’ who hasnt had an accident in 10 years, paid an average premium of 200-300 per year in all that time. the minute he has an accident worth more than 2000-3000 in payout, the insurer has lost money, they not only have to pay claims, but wages etc too and many are struggling to do just that.

  12. I get the whole profit and loss thing and that some claims can be expensive but how come it is in this country that we get screwed left right and centre. Australia, for example, has a charge on all new car purchases that gives third party cover for all owners for the life of the car. As a result fully comp cover is cheap. Insurers seem to hide behind the fact that they are required by law to drive and charge accordingly. The FSA have a principle called ‘treating customers fairly’ and many think that means treating all customers the same. A better way would be to treat all customers based on who they are. I passed my test at 21 and because I drive sensibly I did not have an accident until I was 26. I had amassed 4 years no claims by this point but in the begining I was assumed to be a hooligan who would spend evenings doing handbrake turns in McDonalds and weekends running Cocaine whilst drunk and having fellatio performed on me. Even with a perfect driving record and not a single point on my licence that non-fault accident still bumped up my premium by 40%. I had no say in whether or not that accident took place depite taking action and trying to avoid it. No claims is fine unless some muppet decides you need a shorter car. You get the discount from a massively inflated premium. I’d like to know why you have to pay more for being in the wrong place at the wrong time, its like being charged for medical care because you got stabbed in a rough part of town, the logic being you shouldn’t have been there. That is why insurance is unfair.

    As a sideline rant I always find that Japanese cars are many times what european cars are to insure. I can have a 2wd Saphire Cosworth with 300bhp for £450 as a daily commuter kept on the drive but a standard mk2 MR2 on a classic policy is £4000. Interestingly and somewhat poiniently for this site anything build under the flying plughole will set me back £90 standard or £125 modified. Its always better to buy british!

  13. @Ash – Unfortunately you don’t just insure your own car, you’re insured against anything and everything you may hit. I’m assuming your accident was deemed as ‘fault’ and by that I simply mean the insurer had no third party to reclaim it’s costs from? If so, who should take responsibility for covering the cost there? Where would you like this magic pot of money to come from as, as you’ve said the AUS system hasn’t just happened over night and to implement a system here now would probably add 5k to every new car price. at least.
    This is the system we have, I’m sure to all those people who’ve paid their £500 premium and a month later written off £5,000 of car, causing another £5,000 of damage to a third party, the system seems a little fairer. As I’ve said, it’s there to protect everyone, so everyone has a way of getting something back out of a bad situation.

    And on the Japanese point – doent seem to happen as much now, but for older models, especially more obscure stuff, it was the case that they were higher grouped due to special order parts etc, delivery timescales etc which had a secondary cost of increasing courtesy car times.

  14. @ Mark Mastro. In regard to Japanese cars, are the hiked up insurance costs also due to that stupid film Fast and Furious?
    (Think wazocks with body kits on boggo Civics and you get the picture.)

  15. I can’t wait for these muppets to stop sending data to ambulance chasers to encourage claimants to make dubious whiplash claims, thus pushing up premium costs back to the muppets, then the muppets passing that cost onto me! The vicious circle. Worked in Eire…. Legislation coming soon!

  16. @ Mark Mastro. I say that because ever since that awful film came out, there seems to be a new breed of plonker on the roads, which seem to dearly wish they live in Tokyo, with their car covered in stickers, tailgating, letting the indicator flash once and swerve into another lane.

  17. I’ve always foun d the occupation thing a bit confusing. As an example;

    An aquaintance of mine is an accountant who happened to work for a media company. Declaring occupation as accountant, rather than “I an accountant that works in the media” saw her premium plummet.

    Also, with so many people doing more than one job these days, aren’t you just going to declare the one that gets you a cheaper premium?

    I think what gets peoples goat (certainly mine) is that insurance companies give no credit to individuals for loyalty and good driving record and show them no loyalty when renewal time comes. The whole industry seems to go begging for new business and forget you once they’ve had your first premium.

  18. I don’t believe you when you say they don’t pluck a figure from thin air! How come for exactly the same quote done through different comparison sites one insurer came back with 3 totally different figures for exactly the same policy? These quotes were done at the same time so its not as if any time difference played a part, but what galls me even more these three quotes were around £250 cheaper than the renewal with the same insurance company!

    At least Dick Turpin wore a mask when he robbed you.

  19. @Tim – the occupation thing stems from the likelihood of carrying passengers related to the media being a high risk (as mentioned in the piece) of loss of earnings claims in an accident.

    @Rob C – the same insurance company or underwriters have many individual schemes or arrangements with brokers or aggregator sites, paying them different levels of commision and offering slightly different rates, based on the contract which has been agreed between the two. It stands to reason that if you are a larger company or agregator and are putting alot of business (good business) a certain company’s way, they’ll give a slightly more favourabvle rate to you, to then offer your client.

    The attitude of being robbed will always exist… that is until it’s time to make that call to the claims department

  20. @ Mark, they rob you when you claim too… 😉 How often do they try and weedle their way out of paying, or not paying the full whack to replace like for like?

  21. The The claims settlements can be a bone of contention, some comapnies are definitely better than others at it. In my honest exeperience when dealing professionally and on the behalf of family/friends, if you can find a car of the same spec as yours, similar mileage, same age and within usually 100 miles, they’ll offer you whatever that’s selling at. Claims settlers use the market place, like the Autotrader site etc to come up with the settlement offers. It’s no good just saying my car should be worth xxx.00 amount; if you can prove there are the same vehicles at a price you want they WILL offer you the right amount, or at least near as damn it. That’s not industry talk, thats a fact, I dealt with doing that only last week for someone on an 07 Astra. Never take a first offer, do a bit of your own research and you’ll get what you want for the car, if the market supports your argument. What they wont do is agree a price if it’s 400 miles away, as the area of the country a vehicles being sold in, does affect it’s value, as long as it’s a reasonable distance, they’ll accept it.

  22. @ Mark Mastro. The other driver was found liable in full and my cars value was paid by their insurer yet I still have a bigger bill. The 40% increase came from the best price on compare the meerkat not my broker. The point I am making is that it is not fair that I should have to pay up because someone hit me and settled with their own insurance.

  23. If it’s just a market driven price increase there’s nothing you can do and the claim you had will have no direct bearing on your quote. My insurance invariably increases year on year, these £1500 whiplash claims that people slam in everytime two cars nudge each other have done more damamge than anyone could ever have envisaged.

  24. @ Mark Comment 10

    Thanks for that.

    I remember speaking to someone a few years ago about the issue of under-insurance in relation to home contents. Most folk don’t review their insured contents value regularly enough, especially when they have acquired new more valuable possessions e.g. TV’s Hi-Fi, furniture etc. Then, if the unthinkable does happen, they find themselves massively out of pocket when they claim as their level of cover is probably 5 years out of date. I did recall someone saying it was illegal to under-insure your car/contents (to try and get a cheaper premium) but not sure how accurate this is.

    I’m probably just as guilty at not reviewing my schedules at renewal, possibly because nowadays most companies do automatic renewal and tell you in your letter “You don’t need to do a thing”. Unfortunately most of us take that too literally…!!

  25. I bought an Astra for £2000, ‘er indoors wrote the thing off about 6 months later. Insurance company paid out £2400 (I sent them the receipt for £2000, no jiggery pokery). Surely “market value” works both ways, just because I snaffled a bargain why should I lose out (I dropped £260 on the thing 3 days before she pranged it on a service and MOT, so its not like a won a great deal)?

  26. My tiny story to add:

    In 2002 I bought a 1993 Ford Granada Scorpio with 195K on the clock. It cost me £100 (MOTd for almost a year, and no major faults!), and I spent £60 at a scrapyard for an original Ford radio and CD changer system. A friend even put the car’s registration in for me.

    I then had four new tyres for it. Two had been fitted, and I was going to the garage to get the next two when a driver in a nearly new Colt ran into the back. Her car was wrecked, mine had a bent exhaust, a damaged electric boot release and bumper, and the CD changer stopped working.

    Loss adjuster came out, didn’t even talk to me – just verified the car was what I said it was. My insurance weren’t involved at all. I got a payout of £1,210 and kept the salvage car because I’d just taxed it and it was totally drivable. I don’t even think it got a Cat. D or anything recorded, as they never had the logbook – not sure how that works.

    End of the story was that with 205K on it now, I was going to the scrappy to get a bumper when I saw a dealer I knew with an XM Estate for £400 and swapped the car with them. Next time I saw it was in a scrappy in Loanhead, properly written off this time, and displaying 77,000 miles. Thing is, pre-accident you’d have believed it…

  27. Conversation between my brother Rick and a broker, 1981.
    R: I’ve got a problem
    B: Oh
    R: I just wrote off a Mini
    B: Oh
    R: then I hit another Mini
    B: Oh
    R: but that’s not my problem
    B: Oh
    R: I want to insure a Jag
    B: Oh. You HAVE got a problem.

  28. Mark, thanks for interesting article.
    The part I don’t understand about insurance is that the premium charged is supposed to be a direct reflection of the insurance companies’ “Exposure to Risk” as so well explained in the article. So how is it that the same driver in the same car is quoted a similar premium (or sometimes even more!) for TPFT compared to Comprehensive? The companies exposure to Risk on TPFT is clearly far lower, which is why (traditionally) it was a cheap way to (legally) insure a low value car.
    It’s no surprise with current premium levels that there are so many uninsured drivers out there, and whilst I don’t condone it at all, I do understand why it happens. If the Insurance Companies stopped selling (for their profit) our details to ambulance chasing solicitors then the blame-claim gravytrain might stop.
    Anyway, rant over, it’s still a good article!
    cheers, David

  29. A few years ago, I was shunted from behind when stationary and duly reported this to my insurance company. On phoning them I was greeted with Are you making a claim? No I replied, I am reporting an accident, to which the response was; So your making a claim?

    This anomaly I still don’t understand: The company will obviously press the other persons insurance company to pay for any repairs, so why should I have to have this event to which I am blameless, recorded against me as a claim and have this impact on my rating? Also it was a major operation for me to have my excess returned to me – I had to talk very firmly to the other parties company directly and become almost beligerant for them to return it.

    What would have happened if I had been driving a classic which I had spent many hours and thousands of pounds restoring – would I be offered the market value of possibly a few hundred pounds? Surely you must be entitled to have it returned to the condition it was in before the accident, especially if you are blameless? Are there cases of people taking insurance companies to court to obtain the settlement they believe is representative of the value that they feel the vehicle is worth?

    As stated in various posts the companies are there to make money and we in general are easy targets, being legally required to have insurance. We have a large cartel of self-interested companies acting in unison to protect their operating profits which they are forever trying to increase.

  30. @David – The reason being that there is also the insureres overall exposure to risk; ie, proportionally the number of claims made on say 100 TPFT policies could be higher than say 100 on Comprehensive, ergo TPFT is more likely a policy which would be claimed on.

  31. @ChrisK – there are 2 ways you could have dealt with this incident; 1 – the way you did; ie going to your insurer, making a claim against your policy which is then recoverable by them and at which point your insurer and yourself are re-imbursed the costs/excess. 2 – If you have the other drivers insurance details you can contact their insurer and begin matters through them as a third party claimant (this really is only suitable/possible in cases as clear cut as your own). this removes your insurer from the loop and usually saves you having to pay your excess up-front.

  32. My attitude of being robbed stems directly from calling the claims department. Market value is a joke. When my Mini was written off the payout was around a sixth of the money I needed to buy a roadworthy example, never mind one in the condition mine had been in. And don’t tell me I should have offered proof of value. I did and they told me they weren’t interested. To illustrate the point perfectly, I eventually convinced the company to allow me to keep the salvage, which I sold – as an insurance write off – for more than the payout. The agreed value I’d had on the policy for years had changed to an “assumed value” when the new owners of the company took over, meaning that I didn’t have a leg to stand on. An example of why I need to go over the details of my renewal with a fine toothed comb.

    Then we have the case of when the Metro was stolen. There was no payout as there were a couple of months installments left to pay and I had to hand the hire car back imediately and consider myself lucky that I was not being charged for its use. I eventually got my head around this (and agreed not to drive my Jag – insured with the same company – into the local Aston Martin dealer, admitting full liability as I did so), but then three months later I received a letter claiming that I owed them around £350. I called and was told that I did indeed owe them the money and that they would happily take payment over the phone (at least that’s what I think the broken English translated to). When I asked to speak to a manager it turned out that in fact they owed ME the stated amount and that they had been able to pay all along.

    There’s also the time, many years ago, that my insurance company insisted that I had driven into the other party on an island, causing an accident. The fact that I had provided photographs showing the damage to only the rear of my car, meaning I’d have needed to be in reverse in order to “hit” the other guy (whose damage was on the front of his car) didn’t matter.

    And then, my girlfriends insurance dropped this year while mine went up, despite all the talk of womens insurance increasing and the myth that your insurance drops when you hit 30. Same cars and same jobs for both of us, with her accident history being worse and much more recent than mine.

    Mark the article is interesting and well written but I do feel sorry for you with your naivete regarding an industry you seem to enjoy working in. Don’t get me wrong, I believe that the insurance industry has a tough time of it at the moment. No-one tells the truth meaning that it must be very easy to become disheartened and disbelieve every story you hear, and the number of whiplash and injury claims these days is comical, although the industry must accept a little responsibility for that in some cases.

    When my father in law was rear-ended a few years ago, his insurance company insisted that he go to a private consultation. Despite the fact that he only had a slight ache for a day or so after the accident, the insurance company told him they would make a claim on his behalf due to the fact that all costs were being covered by the other party. When he objected, they told him his claim might not be valid if he didn’t pursue all avenues.

    The industry does little to help itself with public opinion. My premium is higher than the fine for driving without insurance and experience shows me that I will receive little or nothing in the way of cover in the event of an accident or theft. As such, although I don’t agree with it at all, I completely understand the logic behind those who don’t bother with insurance at all.

    Angry rant over and please feel sorry for the members of my team who innocently asked their manager for help while I was typing this. 🙂

  33. @ Richar32

    If it’s the same scrappy in Loanhead I’m thinking of the reduced mileage might have been down to him….!! 😀

    Don’t think he was unused to visits from the local bobbies

  34. @820Tickford. Please don’t interperet any of my explanations as ‘naivety’ of an industry I have worked in for too long! Not knowing the full indivual circumstances of the problems you encountered, obviously I can’t comment in any meaningful way; I would however say that classic or specalist policies (which i’m assuming you had on your mini as you talk about agreed value) are a totally different beast to mainstream insurance, often handled by very small-scale intermediaries on behalf of the larger underwriting houses, the claims departments for classic insurers etc can also be alot more complicated as you’re not dealing directly with the specific company you may be claiming from (very complicated). That said, I often think it’s unforgivable the way some claims are handled and such bad experiences at the sticky end should always be fed back to the company or department who have given the bad experience, as it really is the only way anything can improve.
    As with anything that has a personal emotive impact upon us, dealing with a claim for something is very stressful, the point of the piece is, not about claims (that will come later) but more about understanding things at the off-set and treating things with a clearer perception of the whys and wherefores.

  35. Actually the payout is one that I find curious. I have a 1994 XM TCT exclusive manual, It is one of 2 in the UK and one of 11 of any year in the UK. The chances of finding one for sale is minimal. If you did your chances of getting a sale on offering what Glass’s says the market value is is zero (dues to the sample sie alone theor data is spurious to say the least) what happens with such cars?

  36. The biggest problem is the selling of details to robbing injury claim companies leading to massively inflated personal injury claims, the use of extortionate credit hire type car rental companies and the over inflated insurance rates charged by bodyshops.
    Not that they care becuase all they have to do is up their prices again.
    The industry has to get its own house in order before anyone will have the tiniest bit of respect or sympathy for what is basically legal extortion.

  37. Indeed, It does not cost £200 to deal with a damaged arch, (yes I do know the amount of time it takes, and the cost of the materials)

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