Comic Claims, Claimants And Insurers

Although 2008 is gone and we have since ushered in 2009, memories of the past year remain ever green. In counting their gains and losses car insurers in the UK have some remarkable incidents to recall. AA Insurance, for instance, has revealed a number of comic claims put across to it by customers last year. What is amusing is not the volume of claims but their nature. In a nutshell, the fact that questionable claims often do not pass the vigilant scrutiny of insurers didn’t (and still doesn’t) matter much to some people as they put together facts and fallacies in the hope of squeezing something out of insurers.

Claims and no claims bonus
Last year was particular turbulent for many people in the UK and elsewhere as the world faced yet another financial downturn. In the same vein insurance premiums generally continued to their upwards rise in accordance with costs, including the costs of pay outs to claimants. Logically, every cost in the course of any business needs to be accounted for and considered in relations to the final financial standing of the business in order to know how much accrues as profit.

In the insurance business, especially car insurance, claims often add to the costs of insurers. This explains why people making claims also face the risk of having their premiums increased by their insurers. And in sharp contrast policyholders who make no claims are rewarded with a no claims bonus.

Where the intent is to encourage a careful adherence to the terms and conditions of one’s insurance policy, it also leads to prudence on the part of customers. A good example is a driver or motorist who is so concerned about his no claims bonus while avoided making claims and often takes good care of his vehicle and avoid flouting traffic rules. In the process he is saving insurers money as much as he saves himself rising premiums and enhances his chances of being reward with a no claims bonus.

Raising premiums and claims
In the midst of rising costs, in general, increasing claims from motorists escalate the situation. Not long ago a prominent car insurer revealed that it was almost impossible to make any profit in the industry because of the cost of claims. Claim, it is understand, is a policyholder’s right to claim back money for expenses that were properly insured in a contract with an insurer. But it must be understood that effort has to be made on both sides to keep to the terms of the agreement in the contract.

Whereas it is duty of the policyholders to show that they have adhered to the rules strictly, insurers also need to make a proper assessment of claims put to them and accordingly respond.

However, when dealings with ‘comic’ claims like the one a claimant reportedly sent to AA saying he was “driving from a pub when a sheep landed on the bonnet” of his car etc assessors need to clearly probe deeper. The fact that the car was damaged in the incident, as was told by claimant who incidentally didn’t work hard enough to complete his tale by saying exactly what happened to the sheep, leaves plenty of room for suspicion.

Heeding insurers’ advice
Shortly before the Christmas and New Year breaks insurers, including the AA, repeatedly warned motorists about risks they were bound to face during the festive period. Given that it was also a winter season it was clear the danger could be more serious. In addition to being very careful it was also suggested that motorists who didn’t have comprehensive policies upgraded to enable them have sufficient cover.

Now the festive mood is over and people face reality, what to do to avoid a repeat matters most. Heeding the wise counsel of experts in the industry is an important step being proactive.

By: Aliyu Musa

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