Archive for March 2009

Car Sharing for reward and your car insurance policy

In the credit crunch we are all always looking to save money. With journey to work costs constantly rising, you may be tempted into cutting your transportation costs by entering into a car sharing scheme.
Read this article by our resident car insurance expert before you go jumping into any agreements!

Car Insurance – Do Not Invalidate Your Car Insurance by Car Sharing
By Dave Healey

If you have ever been tempted to reduce your travel costs by entering into a car sharing scheme where you pick up friends or colleagues on a trip to work for example, you must ensure that your existing car insurance covers you and your passengers.

Car Sharing has become much more common in recent years as we all try to reduce our transportation and travel costs, particularly for our journey to work.
Certain large employers are now encouraging the use of car sharing in a bid to appear more ‘green’ and are even providing the facility in the workplace where you can meet and arrange car sharing with other like minded employees in your locality.

Before you enter into any such agreements with others it would be very prudent to check the policy wording of your car insurance to ensure that you are not breaking the law.There is usually a clause or endorsement or wording within your policy documents which excludes driving for hire or reward.

Check carefully the conditions of the policy wording and the exclusions. Make sure that the criterion of the policy offered is suitable for you.

If you are not sure about whether you are covered or might be breaking the law, always discuss this with your car insurance company or FSA regulated broker as they will be able to provide advice for your particular situation.
If they say that you are covered to drive your work colleague to your place of employment, ensure that they are aware of an exchange of money has or has not taken place for the service.

Always keep a note of the name of the person at the Car Insurer or Brokerage who provided the clarification of whether your car insurance policy covers you or not. Keep a note as well, of the time and date that the conversation took place.

If possible find out what position they hold within the car insurance company and their level of authority.

If they say that charging your work colleagues for journeys to work are acceptable under your current car insurance conditions, it would be prudent to ask them to provide in writing a clarification of the cover limits of your car insurance policy.

When you receive notification from your car insurance brokers or company that the driving for hire or reward exclusion is not in effect on your policy, you are able to provide documentary evidence to your employer or work colleague that you are indeed covered to carry them in your car.

Indeed you are in certain cases allowed to accept payment for driving them on a journey you would have had to make anyway to your workplace, with capital depreciation on your car being the same anyway no matter how many number of passengers, and payment for your traveling time. The money you collect can help towards the cost of next year’s car insurance.

So if your Car Insurance Company permits it, maybe car sharing can become green and economical.

Dave Healey is a specialist car insurance underwriter who has been underwriting Classic Car Insurance and motor insurance polices at Lloyds for over thirty years.

Aviva – Change Management out of control

I don’t really care what happens to Aviva, in fact I find it an interesting experiment on brand destruction and it’s subsequent consequences in cyberspace. I gave up caring about Aviva a long time ago when it got taken over by Norwich Union!

How did that happen eh?

Two massive GOOD performing companies General Accident and Commercial Union, bastions of British Insurance for a century, allow some little upstart with a bad reputation amongst insurance brokers – Norwich Union, to come in take them both over, totally change direction, and destroy not just the brands but the ethos and systems of two great companies.

Commercial Union was a mess when GA took it over, in need of new systems and a people cull.
GA managed to absorb what was a good book of general business and the largest Life Insurance account int the UK, into its latest systems with little pain. The merger seem to work well as CGU until the motor bike people came along during the time of large takeovers and stock market profit grabbing.

Those were the days…. I remember the day I was at my city desk when a friend from GA phoned me up from Scotland to say they’d seen CU going into the boardroom at Perth. Oh if only they had Internet day trading facilities in those days……

So recently Insurance blogger has been watching closely and has noticed the following

1 A decision to destroy another brand and move to the megalith status of AVIVA
2. Rationalisation of all distribution outlets – It’s well documented in the insurance newspapers, the souring relationships of the large conglommerates of Insurance Broking Networks, consolidators and the Internet aggregators and the withdrawal of NU from many of these product markets.
NU has also almost completely stopped it’s external Internet distribution and has discharged the duties of affiliates in favour of centralised and PPC marketing.
3.The online affiliate marketing company OMG from Norwich whose account was founded on NU products, has seen all but the LIFE INSURANCE products withdrawn. It’s now beholden to RBS products to keep it alive in the online insurance arena.
At least there are some sensible people in the Life Dept – which rules the general insurance department anyway, as the Insurance side of the business is incidental in the scheme of things.
4. Rationalisation of labour

From an online marketing point of view, Insurance blogger thinks that NU whoever you are, have totally cocked up, and only time will tell just how badly – not that they care, its not their money, they are just playing with the shareholders money in exactly the same way as those bank employees did.

Still I don’t care that they are wasting the shareholders money, they’ll just turn around anyway and put it down to the cost of ‘brand alignment’.

The sad thing is that they are heading in totally the wrong direction.
To be successful on the Internet today, you must have a strong brand.
All the search engine results are dominated by the big brands, including
The IT department has probably told the marketing people to say they’ve got it all under control by using what is known as a 301 redirect to the new Aviva site.
tee hee…
The really sad thinng though is that, they are brand destroyers, acquiring, consuming, and destroying famous british brands that they should be cherishing and maximising market coverage with.
They won’t change, they’ve been doing it a long time – after all they destroyed GA Bonus which was voted for by the readers of Insurance Times as the third most important Insurance invention ever after Lloyds and Direct Line.

Maybe it is the right time to shrink the book……..
Good job I sold my shares years ago.
Hang on they’ve still got my pension fund……..

Thinking of renewing your car insurance policy – read this first!

With the exception of the fairly new practice of issuing pay as you go car insurance policies, when you purchase car insurance you are entering into, and bound by the conditions of, a fixed term contract with the car insurance company. In the vast majority of cases this fixed term is for exactly one year since the date of the policy’s inception or beginning.

As you near the end of the period of cover, your insurance company will invite or tender you to renew the contract. These days the systems employed by large car insurance companies will trigger the renewal procedure which initially means the production and posting of a set of renewal documents to the policyholder. This is usually timed so that the invite to renew pack is produced automatically around fifteen days prior to the termination of the existing car insurance contract, giving the prospective renewal policyholder time to correspond with the car insurance company and inform them of any changes that may have occurred during the term of the contract which are not reflected in the renewal documents.

If you intend to renew with the same cheap car insurance company you are legally bound to inform this company of any alterations to the statement of fact that you originally made when you first took out the policy.
Likewise you may wish to add or remove elements of cover from the current status of the car insurance policy, as your requirements may well have changed over the previous year.

Because of the compulsory nature of third party car insurance, no ‘days of grace’ are allowed after the renewal date of the policy. This can cause problems for car insurance companies as for practical purposes renewal documents and certificates have to be produced and dispatched to the prospective renewal policyholder in advance, which will become operative from the first day of the new period of insurance.

The renewal certificate, required by law to tax a motor vehicle, in theory cannot be issued until the renewal premium is paid. If payment was received subsequent to the expiry date of the existing car insurance policy, then the certificate would have to be re-written with the operative time and date matched to the time of payment. This could cause a major problem for the car insurance companies, as to issue an unaltered certificate would be equivalent to ante-dating it, which is a criminal offence, whilst re-writing the renewal documents would result in additional costs and expenditure to the car insurer, and more importantly would leave gaps in cover for the policyholder, which would leave a driver exposed to risks and legal action for driving without car insurance.

In order to overcome these practical difficulties of renewals, car insurers have developed a practice of incorporating into the renewal documents a certificate of insurance that is valid for an extended period of seven to fifteen days. This benefits both the prospective renewal and the insurance company by extending the period during which the insured has time to pay the renewal premium, yet still receive a certificate dated from the first day of the new contract period.

Car Insurers are particularly sensitive to what is known as the ‘renewal retention ratio’ , the number of renewals expressed as a percentage of the previous years total policies issued, especially since the introduction of online car insurance underwriting which has enabled a prospective renewal to shop around much easier and perhaps to change supplier.

The issue of this temporary certificate of cover in effect and contract law, constitutes an offer by the car insurance company, which the insured must either accept expressly, by paying the renewal premium, or by implication by doing nothing and having the premium taken from the payment source of the previous year’s policy.

If however the prospective renewal obtains car insurance cover elsewhere or by some action, such as a telephone call, implies that he does not intend to renew and thereby not accept the offer, then this temporary cover would be deemed invalid. If a policyholder does not for some reason receive the renewal quote and certificate, or was unaware of the wording of the renewal notice, he cannot accept an offer and is therefore entitled to a full refund if the money has been debited from his account.

With the vast amount of choice available with online car insurance today, ranging from specialist car insurance schemes targeted at a particular group to the aggregator comparison websites, huge savings can be made by a policyholder at renewal if they are prepared to shop around for equivalent cover. It may not be in the best interests of a policyholder to blindly accept an offer to renew a car insurance contract without recourse to other offerings in the market which may be more suitable for their particular circumstances. Car Insurance rates vary immensely and it is not unheard of for companies to match or better a renewal offer from a competitor if you pick up the phone and give them a ring.

Dave Healey is a specialist car insurance underwriter who has been underwriting Car Insurance polices at Lloyds for over thirty years
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Specialist Car Insurance Advice

You may be tempted in the current economic climate to cut corners and take risks that maybe you normally wouldn’t.

This article by specialist car insurance expert Dave Healey explains why you should always think about the consequences of your actions:

Car Insurance – Lending Your Car Could Land You in Jail
By Dave Healey

How many times have you said to the wife, children or a friend ‘take my car’ and not thought any more of it? Even if it’s just a short trip down the road to the shops, you and the person you lend your car to, may be breaking the law! Furthermore if the person you lend the car to, in turn lends the car to another, you will be held liable for any damages caused by the other party, whether you were aware of their use or not.

If you own a car and decide to lend it to another person, it is your responsibility to check that the person you lend it to have adequate car insurance and that their cover extends to driving other vehicles. If you fail to make reasonable checks to verify these details you could be liable for subsequent damage that the person you lent it to causes, and indeed, you may find yourself on the end of a police prosecution for allowing an uninsured driver to use a motor vehicle contrary of section 143 of the Road Traffic Act. It is also you responsibility to ensure that the person you lend it to does not permit others to drive it.

In the United Kingdom, this principle was first established in UK law back in 1934 in the case of Monk v Warbey and Others. Mr Warbey owned a car which was insured to permit driving by himself and other members of his family. He lent it to his friend Mr Knowles who in turn lent it to a Mr May to drive. At some time during use of the car Mr May was involved in an accident for which he was deemed responsible, with a car driven by Mr Monk. Neither May nor Mr Knowles had insurance for third party risks and neither had the means or funds to satisfy the judgement in court against them. It was held that Mr Warbey had originally committed a breach of duty of sub section 1 of section 143 of the Road Traffic Act, by parting with the control of the car to a person who was not insured, and he was therefore held liable for all damages and costs.

It was found in court that Mr Warbey had been informed prior to parting with the Vehicle that neither Mr Knowles nor Mr May had adequate car insurance covering third party risks and had taken no steps to remedy this. Counsel for Warbey argued that the car accident involving May was too far removed from Warbey’s breach of the statute to make Warbey liable for damages to the third party. The Judge disagreed and Warbey was found liable, and the principle enacted by this case remains in UK law to the current day. Up until this point in time the Act did not extend liability to users of cars to third parties, beyond the requirements of common law, but the decision in this particular case imposes upon the owner of a car, whether they have car insurance or not, an additional duty to injured third parties and enables any third party to recover damages from the car owner who permits his car to be used in such a way, knowingly or not.

The only exception to this rule is in the case of employees using a car owned by their employer, where the person driving the car had reasonable grounds to believe that insurance was in force when the used the car.

It would therefore be very prudent if you checked the levels of cover of your own car insurance policy before agreeing to the use of your vehicle by another, and indeed certify that they are covered by either your own or their current car insurance. Failure to do so could land you in the courts!

Dave Healey is a specialist motor underwiter who has been underwriting car insurance policies and in particular classic car insurance polices at Lloyds for over thirty years

Aviva flops with the not so happy public

It seems that the UK public have finally had enough of being ‘Happy’ and want it consigned to the dustbin of bad advertising history along with the Norwich Union brand.

While searching the planet to bring you interesting debate about the state of UK Insurance, we stumbled upon, this amazing post to Aviva’s latest advertising campaign at the Online Ad agency distribution site Visit4vista. You can see the ad and read the original post at the link below.

The post is from someone who calls himself Mr Mustard and although damning, Insurance Blogger thinks that it captures the sentiments being heard ‘down the pub’ regarding this agglomeration of some fine old British Insurance Companies( in Scotland…hmm)under this ‘new’ (six years old) banner.

I see that Aviva (who used to be Norwich Union) are still ploughing on with their ‘Happy’ campaign. It seems amazingly inappropriate and cack-handed under our present financial circumstances, so either they are genuinely uncaring or really believe that they can cheer us all up with this self-congratulationary nonsense. Hundreds of poor saps have been dragooned into their headquarters to shake hands with ‘Happy’ who is welcoming them back into the Aviva/Norwich Union fold.
I’m sure that quite a number of people have had to come back to Aviva/NU on account of it being one of the few financial institutions that is still solvent, but I really don’t see this as an excuse for boasting.
Furthermore, no doubt completely over-excited at their continued solvency, or perhaps just because they have two names, Aviva/NU seem also to have, at present, two advertising campaigns. There is another one out there which is less silly than ‘Happy’ but is merely dull in an efficiently corporate/moderne sort of way, and drones on about a ‘Company built around individuals’, which is hardly a new thought, but is at least inoffensive.
Personally I believe that a period of quiet reflection would be more appropriate for the whole financial sector, and if they want to advertise at all, they should just make very simple and cheap commercials featuring their chief executives and high flying investment managers issuing grovelling apologies for having lost everyone’s money.

More Reasons to question Aviva

1. Call Centres in India when we’ve got people on the dole.
2. Do you know just how many of the other UK financial Institution’s AVIVA has got its hands into and owns a large part of? You’d be very surprised!
3. You tell us – serious comments below please

Thousands Welomed Back to Happy at Norwich Union - soon to be Aviva

“Quote Me Happy” We’re not so happy easter bunnies!