Useful Insurance Online Articles

A leading UK insurance company has beaten the government in the race to introduce road pricing by launching a car insurance policy which takes account not only of the usual factors used in determining insurance premiums such as age, gender, driving experience, type of vehicle etc. but also when, where and how much you drive.

The scheme, which has been on trial for two years is based on statistics which show that individual driving habits can have a significant effect on the risk of having an accident. For example driving during the morning rush hour increases this risk by 50% over driving on the same roads at the weekend or evening. Motorway driving on the other hand is 10 times safer than driving on low-speed urban roads. Not surprisingly, the statistics also show that more serious accidents are likely to happen at night.

The policy, which charges a fixed monthly sum plus a per mile charge that can vary from as little as 1p to as much as £1 for a young driver using their car at night, relies on the information provided by a black box fitted to the vehicle. This uses GPS technology to record how often, when and where you drive. The information provided by the device is used to produce a monthly pay-as-you-go itemised bill showing the premium charged for journeys made during the month.

Norwich Union, the company behind the scheme claim that this new type of policy gives consumers greater choice and is a fairer way of calculating premiums because it is closely tailored to them and their driving habits. They also say that if you drive less than 8,000 miles a year you may benefit from switching to this new policy. Given the very wide range of costs per mile, particularly for young drivers however, this will depend very much on the type of driving you do. If you are a low mileage off peak motorway user you will undoubtedly benefit financially but how many others will do so remains to be seen. Norwich Union are expecting the policy to be a huge success but independent surveys have shown that their is considerable resistance from drivers to having their activities monitored in this way..

Apart from the civil liberties concerns, there are other disadvantages to this form of policy.

Drivers will not know how much their insurance has cost them, unless their driving patterns remain constant from month to month, until they get their bill.

If this type of policy is copied by other insurers, there is also potential for a proliferation of different charges use of your car leading to confusion over the comparative costs of policies from different companies.

Using the example of mobile phones, how many people know if they have the best deal from their own network supplier let alone whether another supplier would be cheaper. There are hundreds if not thousands of different tariff combinations to check for any real comparison of costs to be valid. Norwich Union have already started to sow confusion here by offering young drivers 100 free off-peak miles per month.

The switch to monthly billing is also a clever move. Annual bills only allow insurance companies to increase premiums once a year and any increase is immediately apparent, a rolling monthly policy however, will allow more frequent opportunities to adjust the price and as the increases will be smaller, for them to be more acceptable. As companies would be free to make such adjustments at any time, you could switch from one insurance company after a rise in premium, only to be hit by an increase from the new insurance provider after the switch has been made. You need only look at the increases in energy bills to see how this works.

The introduction of this new kind of policy will allow some drivers to benefit if they are not concerned about having their activities tracked and recorded but for others, particularly those who are forced to use the ‘wrong’ type of road at the ‘wrong’ time of the day it is a definite no no.

As always with car insurance make sure you check that the policy is right for you and compare the price of car insurance cover from several providers before committing yourself. Above all keep track of your costs and check them at regular intervals.

Michael Masters writes for kwikfindcarinsurance.com/uk Car insurance comparison site kwikfindcarinsurance.com which provides information on car insurance issues and a quotation finding service for UK and US residents.

No Comments » Posted by Matt Cubb / Uncategorized

Landlord insurance, also commonly known, as buy to let insurance is something a landlord should begin to consider even as early as considering the purchase of a property. Failure to put in place insurance on a property could leave you with nothing to show for your money should something go wrong. In some cases it can be extremely difficult or highly expensive to put insurance in place for a property and for this reason it is important to have a structural and local survey for the property and look for appropriate insurance policies before purchasing the property. Failure to do so could result in inflated insurance premiums, which ultimately could severely impact your profitability as a landlord.

Many landlords will mistakenly be under the impression that their standard household insurance will still cover the property while they rent it out, this is often not the case. Many household policies offer no cover for buildings nor contents while the property is being let out and for this reason it is crucial to make sure you have a landlord policy or that your current household policy can offer this cover while the property is let out.

Each insurance company offers different levels of cover. Generally there are two options available for buildings cover and two options for contents cover. The first being standard cover which generally covers the building and contents for the following:

-Fire, lightning and explosion
-Riot civil commotion, strikes, locked-out workers or malicious people

-Malicious damage by tenant
-Theft or attempted theft
-Earthquake
-Impact by aircraft, road vehicles or animals, falling of trees, branches, telegraph poles, lamp-posts or pylons or falling aerials
-Escape of oil
-Storm
-Flood
-Escape of water
-Subsidence, ground heave or land slip
-Property Owners liability £2,000,000

Some insurers will also include free additional cover such as the following:

-Accidental breakage of sanitary fittings, fixed glass, solar panels and ceramic hobs
-Accidental damage to underground services which extend from your home to the public mains for which you are legally responsible

-Loss of rent or alternative accommodation
-Communal contents cover

The second option available is accidental damage for buildings and/or contents. This is as clear as the title, any accidental damage caused to the building or contents by the tenant will be covered. It is important to note that most insurers charge extra for accidental damage cover and many will not offer such cover for contents. An example of accidental damage to the building would be a tenant banging a nail into the wall for a picture and accidentally hitting (and damaging) a pipe.

As noted above property owners liability usually comes as standard with a landlord insurance policy. This would cover you in situations such as the tenant holding you liable for an injury, which was caused within your property.

The excess of a policy is how much you must pay when making a claim. The excess on a policy will vary between different insurers and a discount on the premium is often offered in exchange for a higher excess. For example if the excess on your policy was £100 then you would have to pay the first £100 of any claim you made, regardless of the final settlement value. As above the standard excess on a policy will often vary from £50 upwards while a subsidence excess of £1000 is usual with most insurers. The type of tenant you have in the property can effect your excess, for instance several students in a property will often mean your excess will be higher than if the property was occupied by a professional family.

Something to be aware of when insuring the property is that you need to insure it for the reinstatement value and not the sale value. The only accurate way to obtain the reinstatement value is to have a structural survey undertaken by professionals. The reinstatement value should take into account the following:

- The cost of building the property to its original state(take special note for older buildings)
- Clearing the site
- Surveyor costs
- Architect costs
- Complying with government and local authority requirements
- Miscellaneous fees

Insurers will only pay as much as the building is insured for so failure to insure for a sufficient amount could result in expensive costs if a claim should arise but at the same time too high a reinstatement value could result in you paying a higher premium. While there are tools available online which aim to provide a reinstatement value based on several factors you must input, we have found they often produce inaccurate results.

Most insurers will index link your policy meaning that the sums insured will increase each year based on information from the association of British insurers. This means that as long as your original reinstatement value is correct then it should be at a sufficient value each following year as long as you follow your insurer advice.

The Financial Service Authority (FSA) regulates all British insurers. Due to this regulation insurers must provide what is known as key facts or a policy summary for any insurance policy they have available. These are perfect if you want a quick overview of what the policy does and does not provide cover for.

-Stephen Robert Richard Hill, Ashburnham Insurance Services Limited.

No Comments » Posted by Matt Cubb / Uncategorized