Every day, we at PWM encounter challenges on behalf of our clients as we engage with insurers regarding unfair premiums, claim rejections, and the criteria for risk inspections.
Nobody welcomes a rise in premiums, particularly when it reaches double digits.
We are aware that insurers are facing difficulties in their underwriting profits because of natural disasters such as the floods in KwaZulu-Natal and the fires in the Western Cape.
The investment markets represent another avenue through which insurers typically generate income, but they have not been performing exceptionally well in recent years either.
So, what's the alternative for insurers? Increase those premiums!
While that may seem like a viable option, in my view, one should not simply accept premium hikes without careful consideration.
The key factor to consider here is your claims history. If it's exceptionally high, you should anticipate an above average increase.
Continued high claims could potentially lead the insurer to terminate your policy. It's crucial to avoid this scenario at all costs, as obtaining new insurance afterwards will prove challenging.
Instead, focus on managing your risks better. Your broker will assist in this process and handle negotiations on your behalf.
The rejection of claims is a contentious issue. You've likely heard the common complaint, "I pay my premiums, but at claims stage, the insurer denies it." However, it's not accurate to claim that insurers summarily reject claims.
Throughout my years in this industry, I have never witnessed a claim which meets the contractual terms, being denied.
In ambiguous situations, your intermediary should advocate on your behalf. If PWM disagrees with a claim's outcome, we advocate for our clients and have achieved favourable results in many instances.
Claims are declined when policy conditions are not met.
Neglecting maintenance of your infrastructure is one example. Thus, ensure that your gutters remain clear!
Additionally, you must adhere to the laws and regulations relevant to the risks covered by your policy. Examples of this would be, driving under the influence or worn tires on your vehicle.
Another example will be the specific security requirements your policy outlines. Failing to activate your alarm could jeopardize your theft claim.
It's crucial to understand that when an asset claimed for is declared a total loss, it becomes the property of the insurer. You are not permitted to dispose of or sell it without their consent; if you do, they retain the right to reject the claim.
Nevertheless, you have the option to negotiate with the insurer to repurchase the item from them.
Insurers conduct surveys for high-value and complex risks.
These are specific legal requirements that clients must adhere to. If you, as a client, disagree with any aspect of the survey process, you should engage with your broker or insurer to explore potential compromises.
Your broker plays a significant role in ensuring that you are charged fair premiums and that your valid claims, as per your insurance contract, are honoured. Keep this in mind.
