Finance Matters

• 11Aug

  Does travel insurance cover strikes?

  Insurance No Comments

  From This is Money:

  ‘After this point, compensation is normally paid. For example, Insurewithease will pay out £20 per hour delayed for the first 12 hours, and £10 for each additional 12 hour period after this, up to a maximum of £200 in total. I would advise all holidaymakers to clarify this with their providers before making a trip.

  ‘I advise any worried holidaymakers to contact their tour operator, airline and travel insurance provider to clarify exactly where they stand and identify who is liable to pay out in the event a claim needs to be made, whether it be as a result of swine flu or the potential strike.

  ‘It is unsurprising holidaymakers are concerned about whether their travel insurance will cover them if they contract the swine flu virus since it could result in refused entry to board their plane, or being unable to travel at all.

  ‘Although restrictions for travelling to Mexico have been lifted, it is still worth checking where you stand with your insurer if you are…

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• 11Aug

  Car insurance costs forced up by uninsured

  Insurance No Comments

  From This is Money:

  More and more cash-strapped motorists are thought to be failing to renew policies to reduce their bills in the recession.
  Around 1.6m are believed to be driving without insurance, leading to an increase of £30 per policy for drivers who do pay.
  Premiums are also being pushed up by a rise in the cost of car repairs, and an increase in personal injuries claims and the legal costs that come with them, according to AA Insurance.
  A rise in the number of fraudulent claims is also having an effect. The research found that premiums are increasing at their fastest rate for nearly a decade.
  Between April and June, the average quote for an annual comprehensive car insurance policy increased by 3.5% to £778.13. Over the past year, premiums have gone up by 11%.
  Simon Douglas, of AA Insurance, said: ‘Although the number of accidents on Britain’s roads is thankfully falling, the cost of claims continues to rise – particularly personal injury claims and legal expenses.
  ‘During…

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• 11Aug

  10 insurance scams that didn’t work

  Insurance No Comments

  From This is Money:

  Insurance fraud has increased by almost a quarter in two years. The Association of British Insurers (ABI) estimates it costs £5.2m every day and adds an extra £44 to the cost of all home and motor policies.
  In a survey for the ABI, more than two in five people thought it was acceptable to increase the value of a lost or stolen item and three in ten said it was OK to overstate the extent of any damage to items when claiming.
  But insurance companies are stepping up their efforts to expose the cheats. With the help of Mark Jones, a consultant in financial crime at EMB, we reveal some scams that failed.
  1. A woman said her £200 ‘bingo winnings’ were accidentally incinerated while she was cooking. She claimed the wind blew the cash on to the hob, catching fire. She sent in the charred remains, but these amounted to about £20. The insurer also felt the description of the location of the window, table and hob made it highly implausible.
  2. A man claimed &poun…

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• 11Aug

  RSA makes drivers and housholds pay

  Insurance No Comments

  From This is Money:

  RSA, formerly Royal & Sun Alliance, insures 2.6m cars or homes in the UK through More Than and said the increases in premiums had been necessary to help combat the effect of a falling housing market and slow car sales.
  It confirmed that motor insurance premiums had risen by an average of 5%, while household cover rose by around 4%.
  Business customers were hit even harder with 6% increases to property insurance and a 9% jump in motor cover for firms.
  The price hikes could not prevent RSA posting a drop in profits for the six months to June 30. Profits fell by 3% to £1.34bn. The groups Combined Operating Ratio ? an industry measure of claims and costs as a percentage of premiums, where anything below 100% is a profit ? was squeezed to 97.4%, up from 96.2% a year ago, underlying how tight the margains have become for insurers.
  An RSA statement to accompany the results said: ‘The UK remains one of our toughest markets and we are maintaining our strategy of targeting profit…

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• 11Aug

  Got a little smasher? Check your policy

  Insurance No Comments

  From This is Money:

  Eventually Rishi came clean and admitted he had caused the damage. Luckily for his parents, Dipak, 49, and Penny, 47, both IT consultants, their insurance cover included accidental damage to window panes so the cost of replacing it was minimal.
  With the nation currently gripped by the Ashes cricket series between England and Australia and the football season kicking off on Saturday, many insurers are reporting a big increase in claims for accidental damage, particularly broken windows, caused by children and adults playing ball games in the garden.
  But you should read the small print of your buildings and contents insurance policy to see exactly what accidental damage cover you have as it varies widely between insurers.
  Glass damage is standard in many policies but may not always be included in low-cost or budget cover.
  The Tanna family from Cambridge pay about £500 a year for buildings and contents insurance with Aviva, the new name for Norwich Union. Aviva’s buildings…

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• 11Aug

  Drivers charged 40% interest on insurance

  Insurance No Comments

  From This is Money:

  The eye-watering interest rates are being charged on insurance premiums that are rising at their fastest for nearly a decade. The average annual comprehensive policy costs £778, according to the AA, up 11% over the past year. But interest charges could add up to £175 to this bringing the cost to £953.
  The AA estimates 13.2m of Britain’s 33m drivers pay premiums monthly by direct debit.
  The impact will be greatest on young drivers who already face the heftiest premiums and, with smaller incomes, are most likely to pay monthly.
  Research for Money Mail by comparison website Gocompare.com shows many major insurers charge an APR of around 25%. The Green Insurance Company charges a hefty 39.4% – more than 38 times the 0.5% Bank of England base rate. Asda charges 28.6%, while Budget and Virgin Money 25.9% and the AA, Churchill and Privilege charge more than 24%. All are way above the average credit card rate of 16.9%.
  Gocompare.com spokesman Hayley Parsons says: ‘Wi…

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• 17Jul

  Is your car covered for holiday motoring?

  Insurance No Comments

  From This is Money:

  It’s a little-known fact that most comprehensive motor insurance policies revert to basic third-party cover once you cross the Channel.
  So, while you’ll be covered for damaging someone else’s car, you won’t be covered for damage to yours.
  Figures from the AA show the average cost of repairs on the Continent is more than £400, and returning your car to Britain is likely to cost £1,000.
  Those that normally provide only third-party cover abroad include Aviva (formerly Norwich Union), Esure, Churchill, Direct Line, LV= and Sheila’s Wheels.
  Others give you a few days’ free comprehensive cover.
  More Than provides four lots of five days’ driving abroad, while Swiftcover gives you up to 72 hours overseas, as long as you tell it before going. You can upgrade to comprehensive cover for your whole trip with all these policies for an additional premium and there may also be an administration charge.
  With Esure and Sheila’s Wheels, a week driving in France will cost £…

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• 17Jul

  Travel insurance you don’t need

  Insurance No Comments

  From This is Money:

  Those with an annual travel insurance policy are already covered and even those without one could buy it far cheaper.
  Research by InsureandGo shows some holiday companies are charging as much as £45 in cancellation cover for a family taking a break in Britain – that’s more than three times dearer than the price of a week’s travel insurance.
  More than half of them charge £20, far more than normal travel insurance, which includes cover for lost or stolen luggage, medical claims and travel delay.
  For instance, travel insurance covering a week’s break in August for a family of four costs £6.62 with Essential Cover – including £3,000 cancellation cover – and £9.54 from TwoPointFive with £1,000 cover.
  Cancellation cover typically enables customers to claim refunds on their holiday if they have to cancel due to sickness, jury service or redundancy – an increasing risk as unemployment rises.
  ‘We think these holiday companies should ask if their cu…

  Click to read the full article »
• 11Jul

  How to cut insurance for young drivers

  Insurance No Comments

  From This is Money:

  The contestant is a loyal and profitable customer who has been insuring their cars with you for years without making a claim. They phone and want to add their 17-year-old son or daughter to the policy. Do you?
  A) Say: ‘No problem. Tell me all about them.’
  B) Charge them the price that accident statistics demand, quadrupling the annual premium overnight.
  C) Double the premium, but add a £500 or £1,000 compulsory excess if the youngster causes a crash.
  D) Say: ‘No way. We don’t touch under 21-year-olds with a barge pole.’
  Unfortunately, for young drivers and their parents, who are often footing the insurance bill, the most likely answer is B, C or D. And you almost need to be amaire to pay the premiums.
  The simple fact is that young drivers are most car insurers’ worst nightmares – one in five new drivers will have a crash within the first six months of passing their test.
  Andy Goldby, director of motor underwriting at Direct Line, says: ‘Drivers under 21 are t…

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• 03Jul

  Avoid the car smash insurance con

  Insurance No Comments

  From This is Money:

  These staged accidents, where an innocent driver is forced to smash into a vehicle used by fraudsters, are a frightening menace.
  By padding out claims with fictitious passengers, dubious injuries and fake repair costs, each shunt can be inflated into a lucrative pay day – as much as £50,000 in some cases.
  While the chances of being involved in a staged accident are still low, insurers say it is a growing problem. Susan Jones, head of the investigations unit at the Insurance Fraud Bureau, says: ‘We believe there are about 30,000 incidents reported to insurers every year that relate to staged, invented or induced accidents.’
  As Financial Mail reported last month, bogus claims add about £40 to the annual insurance bill of the typical motorist.
  There have been successes. The Insurance Fraud Bureau (IFB) reports an 11% reduction in the estimated number of incidents over the past two years. But drivers can do their bit to fight back. Insurers are trying to raise awarenes…

  Click to read the full article »

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