Coles Insurance.

[Renato1]

So my wife got her car insurance renewal from Toyota Insurance - around $946. It seemed a bit high so we got quotes on the internet for the exact same insurance product from various insurers.

GIO - $763

APIA - $539

And then, remembering all the ads about how cheap Coles was, and after applying the 15% Flybuys discount - $1014.

My wife rang them up to ask what was up. They said they'd offer her $710

In my opinion, something fishy going on here.
Regards,
Renato

[casstony]

You must be mistaken Renato - insurance salespeople are just as honest as car salespeople :)

[rrussell1962]

When the renewal notice arrives have a go at getting a mate to phone the insurance company and getting the same cover as a new customer.

[multiweb]

If the policy and cover look alright take it.

[Renato1]

But they certainly seem cheaper than their computer on-line equivalents.
Regards,
Renato

[Renato1]

I suspect, as my wife does, that one would get a better deal, as you infer.
Cheers,
Renato

[xelasnave]

I have been watching TV lately, during the day whilst I am on the internet.
I am amazed the number of insurance adds.
They must spend all their premiums on adds.
Funeral insurance, car insurance, house insurance, injury insurance, life insurance...relentlessly all day everyday..where does the money go...will it ever come back?
The history of insurance is interesting basically started out as gambling on ship arrivals and legislation made it "legal".

[rrussell1962]

My Dad used to do it with his car insurance, he would then amuse himself by calling the insurance company back, telling them what he had done and get them to match the quote. It usually worked for him.

[xelasnave]

Insurance companies have some little tricks.
For example if you complete a proposal with their agent and he tells you to answer a question a certain way and that places you such they can avoid the policy and you say ..but your agent told me so..they say..oh at that point he was your agent not ours tuff luck policy voided.

[Renato1]

Insurance companies generally make a lot of their money from the money they've invested rather than from the difference between what they bring in and what they pay out. Even if they pay out as much as was paid in (be it in claims or advertising), they profit on the investment returns from holding the premiums.
Regards,
Renato

[Renato1]

Fascinating, thanks.
Cheers,
Renato

[Renato1]

Well, when one goes to court over it - the court may have a different opinion about unscrupulous practices and exactly who's agent he really was.
But it would be a costly exercise.
Cheers,
Renato

[xelasnave]

Hi Renato
I believe the law supports my proposition, it was the case when I did commercial law many years ago.

I can not provide authority but I am certain enough as many cases supported this strange aspect.

[Renato1]

But the agent must have a contract with the insurer. And if it was as prevalent as suggested - that could be a class actionable scam.

Can an insurer really get away with voiding hundreds of claims, resulting from poor advice given by his agent - and washing his hands of it everytime? I think there would have to be some duty of care or unconscionable conduct aspect that would come into it.

They have actions against banks for charging fees that they laid out in full to clients would be the case before hand. The gravity of what agents have done would be worse than that.
Cheers,
Renato

[xelasnave]

I lost my library in a fire which took everything in 2002 otherwise I could give you the case where this was given as law, together with a list of others.
In my view it goes against agency law but it is not the only example of strange things relating to insurance.
Ask a law student who should confirm it for you...it's one of the basics really.
You may like the notion of "co insurance.
You insure your house for say $300,000 it is destroyed.
It is found that the house is worth $600,000.
The insurance company then says they will pay out only $150,000.
Why? They rely on the principle of co insurance, which means as you insured for half the value they only have to pay out half the insured sum.

Now you say but I paid for.$300,000 cover..too bad the principle allows them to pay half.
Now not only did I learn this from my studied but early on we had a client who experienced this when his box factory burnt down.
So I saw it in action.
After studying insurance you find many cases where they really have the law on their side.
Most cases can not go to court because the insurance contract is subject to arbitration clause.
In other words if there is no matter where interpretation of the law is involved you can not even go to court.
I would expect in both of the situations re agency or co insurance you could not due as the law is clear.
As I suggest if you are ever at a party with a law student ask..but do not ask a qualified lawyer or he will bill you.

[xelasnave]

A farmer insured his car.
On the proposal there is a question ..where is the car normally garaged.
At his farm goes on the proposal.
The car is destroyed by fire at the farm.
The insurer successfully avoids the claim because on the weekend, two nights, the car was garaged in town.
Now that was a case that went to court and as such it is public record of their sneakiness...only 20 percent avoid arbitration so imagine howmany nasties never get aired...you can't of course disclose what goes on in arbitration.

My Son left his car on a sand flat and lost it to the incoming tide.
The insurance rep when asked what's holding up the pay out he says..we are awaiting a police report.
Intimidation or what...the police did not attend so the implication was we are suggesting fraud.
Well I went off.
If you are hinting at fraud make your case now otherwise this will get very bad for your company.
They folded but clearly a plot.

When in Real Estate I managed properties.
One had severe storm damage, I stupidly paid the bill because a mate did the work and I was prepared to wait for the insurance.
After some time no money fri the company.
I my girl chased it and told it was in the mail..a week later no cheque..I personally phones..yes in the mail sent yesterday....jm.
Another week no cheque so I personally go to the head office..
The cheque was sent yesterday...jm
I want you to cancel that cheque and issue me a new one now.
That was at 9_30 am.
Can't do that the manager is busy.
OK I will wait.
I waited all say and got the cheque at 4_30 pm only because it was clear I would not take no for an answer.
During the say I witnesses at least 20 people approach the desk asking for their money..all were told the cheque was in the mail...all went away happy...what a con.
One guy however had been played before..man he lost it.gr got his cheque.
And so my experience with insurance has been sprinkled with some disturbing observations of terrible practices and unfair laws.
Hope this is readable the phone corrects stuff that I miss.

[Renato1]

Thanks. You aren't wrong about sneakiness - though word sometimes gets around about the really sneaky types. I wonder if long term it affects their growth prospects?
Regards,
Renato

[xelasnave]

I doubt it.
By the time you gain this experience you are old, like me, and folk think that does not happen these days.
I recall my father warning me a bank could call your loans in on very short notice.
Well Dad that's in times past.

My view changed when it actually happened to me in one of the credit squeezes.

Still they did me a favour because I never used an over draft again and learned that with a spread sheet and careful planning I really did not need their credit line.

[Renato1]

You aren't wrong, it's in everyone's mortgage that they can do that. But back during the GFC in 2008 and 2009 they left residential mortgages alone but went in really hard on commercial mortgages - owners of huge buildings in the major cities. This put such pressure on property trusts that 90% of their values were wiped off on the stock exchange, and investors lost over $100 billion. And there wasn't even a recession in Australia.

One financial commentator said at the time that if the banks had done to residential mortgages what they did to commercial ones, there would have been rioting on the streets.
Cheers,
Renato

[xelasnave]

GFC I missed.
I retired because I knew it had to come.
I was a little early but what the heck.
And no one got their hands on my money so , what GFC.
Now when I think of making money I head it off with a question...why bother you got what you want and can't play with all your toys...so such is the curse of contentment old age and dodgy legs.

[ianB]

Whenever I need to renew my car insurance I call them and say I intend to go elsewhere as I can get a better deal, usually they then say hold on for a moment, then they tell me that as a valued customer they will give me a further discount.
( I rely on the fact that the person taking my call does not want to be responsible for a customer leaving and going elsewhere, as such they always give me a better price that the one posted out to me )
Likewise with my credit card, I call and say that I intend to go to someone else with a better % rate, twice they have said ' I will see what i can do' and was then given a lower % rate.

[Pinwheel]

On a more positive POV when we insured our farm, the first year we lost a shed due to a massive wind storm. We claimed & I got a brand new metal shed with concrete floor & power for an excess of $50. I'm happy!

[zenith]

I used Budget Direct's online quote calculator and changed the excess, restricted the drivers, didn't bother with hire car replacement etc, and ended up under $600 for each car at our household. Funny thing is one car is worth $2600, and the other car is new.
I switched from RACV many years ago as they were expensive, slow and frustrating to deal with. I figured I'd pay the cheapest rate around for the privilege of being treated like a criminal when I needed to claim, and to my amazement Budget were friendly and quick, and cheaper than AAMI, Alianz, RACV...
But on house & contents I found AAMI were cheaper.
Also everyone's online quotes seemed to be cheaper than if you called them.

One thing to be aware of is that some insurers may repair your car using non-genuine parts, and so your car's safety rating may be effected. I am not sure what Budget Direct do, must look into that...

[Dboots]

Hi All,

I am not in the insurance industry but I deal with insurance matters on an almost daily basis. I have 3 golden rules when it comes to choosing insurance:

1. Read the PDS;
2. Read the PDS;
3. Read the PDS;

Different insurance companies provide very different cover for what often appears to be the same product. As an example, below are the definitions of "Storm" from popular insurer's PDS:

A storm has very strong winds and may also involve heavy rain, hail or snow. For example,
a cyclone. A storm is not just continuous bad weather on its own.
Yes A storm causes loss or damage to your home or contents.
No Loss or damage caused by:
• rain or wind that enters your home through an opening that was not
made by the storm
• power surge (but we may cover you if another insured event at your
home causes the power surge)
• rain, hail or snow after it reaches the ground (but we may cover that
under the insured event ‘Flood’ as flood or water runoff).
A storm that happens during the first 72 hours from when we first cover
your home or contents (but we do cover you if you take out your policy
when you sign a contract to buy your home or we replace another
insurance policy).
Loss or damage to:
• driveways, garden borders, paths, paving and playing surfaces
• paint and external coatings of buildings when there is no structural
storm damage to other parts of your home
• swimming pool and spa covers and liners that are more than 5 years old
• free standing walls.
Anything that happens while you’re renovating your home (but we do cover
wind damage caused by the storm).

and:

9. Storm, rainwater or run-off
(Applicable whether you have buildings and/or
contents cover)
We will pay for loss or damage caused by storm, rainwater
or run-off.
“storm” means violent wind (including cyclones and
tornadoes), thunderstorms and hail which may be
accompanied by rain or snow.
“rainwater” means rain falling naturally from the sky onto
the buildings and/or ground.
“run-off” means rainwater that has collected on or has
flowed across normally dry ground or has overflowed from
swimming pools or spas.

The second definition provides far greater cover than the first yet most people stop reading when they get to the $$$.

Insurance is only of value when you need to make a claim. There is no point having insurance that does not cover you when you need it.

Duncan