Know your Car Insurance? Or Forza Ferrari!!

 

Last weeks memo showed you many of the 'additional benefits' included in our standard Home & Contents Policy. It's amazing how many people do not know all the extra features that are available to you and how vital these are in assisting you get back to the same position you were prior to a claim. It also puts some perspective on some of the pricing available in the market. It's not all doom and gloom!

Today we move onto your Car insurance. I make no apologies for a being a car nut. OK so I cant tell you the In's and outs of every car like some or why one is better then another...... I just love em! The technology and the fact that designers can do what little boys love doing everyday, just draw cars. It's always fascinated me. Formula One technology is something I have loved since, well, as long as I can remember. As a lad I used to set the "VCR" through the 80's and then after school come home and watch the race. I'd keep away from news so the result was a mystery to me. Now, 30 years on and I have to say I still do it!!

The Ferrari 308 GTS is my all time favourite car. Cue Magnum PI music right about now. Here we are nearly 40 years on and the design is as attractive as any super car on the road today. And boy, did it go like the clappers!! It is a still a dream to one day drive a 308 and attend an F1 GP. Hey, still plenty of years on God's earth to do it.

As long as motor cars have been around there has been motor insurance. It hasn't changed a great deal over the years in it's basic format but what has had to change is how Insurers rate vehicles and what is deemed repairable and not. 60 - 70 years ago a car was a car. There were not numerous different variants to rate. For example the 2013 Toyota Hilux has 35 variants! That's just one make and model. The Mazda Bravo has similar numbers. Believe it or not but each has a difference that is crucial to how Insurers assess there repair cost and theft risk. Often you will see groups like the NRMA release data on vehicles most attractive to car thieves. This is not just throwing some numbers together, it is careful compiled data which car manufacturers use to improve their brands security.

 

If you believe TV advertising then some Insurers cover more on their Motor policy then others. It's true you need to be careful and check if your motor insurance is covering extra features you have added 'After Market.' If it comes to a claim you may only get the value or replacement on a stock vehicle if you have not disclosed or have proof of these extras. We usually ask that clients email or fax a copy of the sales invoice, then we know we are capturing all modifications and accessories. This can be difficult with older cars. Often the value of accessories in a car say 10 years old or more is worth more then the car itself. Insurers in this instance will usually only insure accessories to a limit of around 20% the market value of the car.

So what does your policy cover you for when you end up in a ditch. If you insure your vehicle for market value be careful that you originally set this correctly. Market Value is the value of the vehicle less any costs for registration, warranty costs, dealer delivery and GST. For example if you pay say $30,000 for your new business vehicle the actual value of the car itself might be as low as $25,000. This is what it should be insured for. If you get finance they will tell you to insure it for the full value as they have lent you money on $30,000. Reality is if the car is written off on day one of the policy the market value is $25,000 leaving you with a nice gap to sort out.

 

So onto the Additional Benefits. We're using the Allianz Insurance Advisernet Secure Car wording as our example but remember each is different. This policy is one we sell alot. It automatically includes excess free Windscreen protection (First claim) whereas on most others it is an option. Benefits on this an many others are varied but for example purpose check out benefits you are entitled to;

 

- Towing Costs: These can be many hundreds of dollars. If you are comprehensively insured this should be a standard benefit of the policy.

- Hire Car following Theft: This is usually automatically included. Don't be fooled this is after "Theft" only. Hire Car following an Accident is generally an option you need to purchase.

- Accommodation Expenses: Like your home insurance you can get a benefit of temporary accommodation. This would be if you car is damaged or stolen and you are over 100 km's from where it is usually parked.

- Child Seats: Check your policy. If with a direct insurer you may not have cover for baby seats. It can be a handy benefit. We have gone through this phase and know the costs on these seats.

- Funeral Benefit: Yes a benefit can be payable towards a funeral if the driver sustains a fatal injury.

- Finance Gap Cover: We mentioned finance a little earlier. If you have a gap some policies have an additional benefit to cover up to a certain value of the difference between the loss and the payout.

- Hospital expenses: Not just hospital but dental, ambulance and pharmaceutical.

22 Additional Benefits exist on our example policy, above are just 7.

 

When things go wrong it's also important to remember that obeying the road rules is crucial for a claim to be accepted. Remember your Insurance is a contract between you and the Insurance company. If you breech a law then your policy can be null and void. Simple things like having a an accident whilst driving illegally, speeding, texting, drink driving. All these can lead to a claim being denied by an insurer. Another trap of some direct insurers is nominated driver policies. We once did an exercise with a known direct insurer. They wanted every single person who could drive the car to be noted. If they weren't and they had an accident..... no claim. Keep in mind if your Mother in Law drives you home after a big night.... is your car covered?

 

So be aware of what your policy covers you for. Think about what is important to you if something were to happen and make sure you purchase a policy that meets your needs. You may not want all the additional benefits but if you get them all for say only $100 more per annum then it's a small price to pay. Likewise nominated driver policies are fine but make sure you read the conditions on occasional drivers and don't get caught out. As always if we can assist please contact us.

 

 

*** Information within this blog deemed General Advice and does not take into consideration any one persona individual circumstances. Please read the relevant PDS and seek advice on your own Motor Insurance. Additional Benefits courtesy of Allianz Insurance Advisernet Secure Car wording POL285BA/IAA 06/10.