Let me expound what I mean. It’s easy to play into the stigma that insurance is a waste of money or that it’s a grudge purchase, a play on moral obligation, but I disagree, I strongly disagree. To give context, I just managed a car insurance claim (general insurance) for my father. He was hit by a seemingly distracted driver who breached his lane, whether or not the driver saw him or misjudged his overtaking was unconfirmed, but the outcome was a collision into dad’s car on the front driver’s side quarter panel whilst dad was maintaining total compliance within his own lane and going a reasonably low speed (30-40 kms/hr) having turned a corner and just before completely straightening.
The at fault driver did not stop and proceeded to drive away, there would have been no way he could have been oblivious to the impact, the damage was sizable, an impact not simply a scrape. We filed an incident report with police right away, and the following morning (as soon as practical) submitted a claim with dad’s insurer, with me down as an appointed handler of the case on behalf of dad. We gave the insurer our version of events as well as the rego number of the offending vehicle, we assumed it would be straight forward, alas it was not. While they were happy to fund the repairs, we were still apparently liable for the excess until such time they could find an at fault driver, the insurer informed me that there is no real dead line for the case like this, that they have a, ‘process to follow’. The excess would have been $760, to which the case manager smugly retorted, ‘you can book in and get the car fixed now sir, it’s a bit of a pill to swallow’. I replied, ‘a pill, more a bullet don’t you think? Seeing as we feel we were not at all at fault, rather an innocent party who has to live with a less than desirable car that was comprehensively insured, isn’t that more to the point, $750 is not a small pill Sir?’
So at this point, it would be easy to be peeved off, act irrationally and irately but why? I’ve got a contract to rely on, I’ve got a timely submitted police incident report and there is a process in place, so let’s get on and ask about that process. Once I confirmed the process with the insurer, I asked if I could contact the case manager on a weekly basis to get updated and to ensure the milestones were being met, can they really say no to this, I think not? Three weeks later and today I get a decision, our excess is waived for $750, car is to be fixed as soon as practical and our insurance plays out as was designed to on genuine claims. I would estimate the damage to be in the thousands (2-3k) as it was across 2 panels and damage to an expensive rim.
Morale of the story: Although this was not a personal insurance claim (i.e. life, TPD, trauma, income protection or business expense cover) the same principles apply. Had we not had comprehensive insurance, we wouldn’t have had a leg to stand on. Whilst the process can be frustrating (matter of perception), we still had skin in the game, there is a statutory obligation on both parties to act with utmost good faith, and hence the responsibility on the insurer would be to;
• assess claims promptly
• not delay paying claims without proper cause
• not refuse to pay claims without proper cause (for example, by inappropriately preferring a GP’s medical opinion over that of a specialist)
• in some circumstances, specifically advise the consumer of what risks the policy covers.
Insurance, I argue is not a trivial expense rather a reasonable and totally valid hedge against a sh*t storm that you otherwise cannot control. It puts you in the seat of power and sways favour in your court. The ability to pay your way out of trouble is tantamount to the second best option you could have, to the event not happening at all, your Life can move on, you can get on with it. Image if this was not a car, but your ability to function normally due to disability or illness, would the gravity or need for insurance not be greater if we were talking thousands, if not millions?
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Image courtesy of [Stuart Miles] at FreeDigitalPhotos.net