Updating Insurers - When you gonna call?

When you gonna call?

New Zealand drivers aren’t in a hurry to let their insurer know about traffic convictions, a survey by insurance company IAG New Zealand has revealed.

One in five of us (20 per cent) would confess to being slammed with speeding fines and other charges before our policies come up for renewal, the survey showed.

However, a third of us (33 per cent) would actively update our policies if we made modifications to a vehicle.

As part of the ‘IAG Safety Insights Monitor’*, the survey was carried out by the insurer in June this year. It asked 800 Kiwis what situations would prompt them to contact their insurer.

Chris Kiddey, National Technical Specialist at IAG, which owns State, AMI, Lumley and Lantern, said that if you don’t know whether to contact your insurer about a change in circumstances, the answer is just a conversation away.

Car Modification and an extra driver under 25

He added when it comes to car modifications, it may depend on the value of the upgrade.

“Usually you won’t have to notify your insurer until your policy renews, but better safe than sorry: if in doubt, make the call,” he said.

The results showed that just under half of us (44 per cent) would bypass telling our insurer if we had an extra person under the age of 25 years old driving our car.

Mr Kiddey said you do not have to call if a person under 25 is driving your car as the average motor vehicle police does not have an automatic restriction for young drivers, but policy holders can sometimes choose a restriction in return for a discount and that requires you to call the insurer when a person under 25 is driving your car.

Health Condition

But what about changes to your health condition?

Similarly, three in five us (60 per cent) would declare a health condition that affected our driving skills, such as having to wear glasses while behind the wheel

“You don’t necessarily have to tell your insurer about this,” Mr Kiddey said.

“But be careful: if you legally can’t drive and you have an accident, you may not be covered”.

High-value purchase

A pricey purchase emerged as the most likely reason why we would touch base with our insurer.

Almost two thirds of us (65 per cent) would update our policy to include an expensive new item, such as a piece of art or jewellery or a coin collection.

Women are marginally more likely than men to protect their more precious assets, with two in three (66 per cent) of women saying they’d ring in a new purchase to their insurer, compared to slightly fewer men (63 per cent)..

When you buy something expensive, you should call your insurer, Mr Kiddey said.

“Virtually every standard policy has limits payable for items such as these,” he said.

“By contacting your insurer you can discuss whether your policy can assist you should something go wrong, or whether you need to arrange for something more comprehensive.”

Paid guests/flat mates

Two in three people (68 per cent) would have paying guests in their home without changing their cover, which could leave some people being vulnerable should a tenant or guest cause damage and they need to make a claim.

However, Mr Kiddey said this should not usually be a problem if the policy holder is also living in the home.

“But many policies can limit cover for rental homes or even exclude certain types of damage,” he said. “Best to ask before hand!”

Renovations

Fewer than a third of us (32 per cent) saw a need to let insurance companies know about renovations being made to a kitchen, bathroom or any other part of our property.

“A coat of paint, new fixtures, redoing the lino, minor things such as these are no problem,” Mr Kiddey said.

“But let your insurer know if you’re doing anything structural – you may not be covered for any related losses.”

He said that you must call your insurer if you are doing major home extension work, even though less than half (49 per cent) of respondents said they would.

“Most policies exclude loss or damage related to ‘structural additions or alterations’ or similar,” he said.

“‘Contract Works’ cover exists to take care of risks like this.”

On the move

Kiwis were split almost straight down the middle when it came to getting the right cover while on the move.

Just over half of respondents said they would get their insurer involved if they were to shift their home contents into storage (51 per cent) or between addresses (50 per cent).

However, Mr Kiddey said it’s important to call your insurer.

“While some policies have limited cover for contents in storage or transit, you can’t take that for granted – some offer no cover at all.

“Better to discuss a policy specifically designed for the scenario.”

Go holidays

However, more than half of people (58 per cent) would leave their home empty for more than 60 consecutive days without notifying their insurer.

“Definitely call,” Mr Kiddey said. “Many policies tell you that cover will end after a certain period – unless you contact your insurer.”

Kevin Hughes, Executive General Manager - Consumer at IAG said the survey provided us insights on customers’ understanding about insurance and directions on how to help customers understand it better in the future.

“It is important for customers to tell their insurers before a change in circumstances, to ensure they are covered by their policies when the change takes place. Sometimes people think the change to their situation isn’t important enough to call their insurer about or perhaps they might worry it could result in a higher premium, but that isn’t always the case”, Kevin said.

* ‘IAG Safety Insights Monitor’ is a series of regular and seasonal surveys commissioned by IAG which trades in New Zealand under AMI, State, NZI, Lumley and Lantern brands. The purpose is to increase customers’ awareness of how to be safer on the road and at home. This Survey results are based on an online survey of a representative sample of the national population aged 18 plus, conducted from 17 to 24 June, 2016 by Trace Research. The survey had a sample size of 800. In order to ensure the national representativeness of the results, the survey data has been weighted against key demographic indicators (e.g., age, gender and region) according to the 2013 census data (Statistics NZ). The margin of error is 3% at the 90% confidence level.

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