Following a recent thread within which somebody was sounding off about the
uniform rise in insurance rates which the insurers seem to be universally
justifying by the rising costs of claims including terrorism, I have had a
conversation with Simon Brain within which we explored the whole issue and
which he thought should be bounced off UKTC.
As I think I said in that thread, my insurers justified my 28% rise due to
acts of terrorism and other trends in insurance claims. The previous year in
the UK that might have been flood damage, next year, who knows.
In stark contrast to this, a few lines later the letter informed me that I
was not covered for acts of terrorism! How ironic.
Can anybody explain why this should be considered fair and reasonable? Do we
have any insurers on the forum?
The insurance companies collect premiums they they project to cover their
risks and provide them with profits and we pay those premiums covering those
risks, for that year.
Now that may be a simplistic view but in reality it's a bet, some years sh*t
happens and they make a loss or little money but other years you don't hear
them moaning, no, not when the profits are "acceptable", whatever that may
mean.
And where are those profits of yesteryear what happened to them, are they not
available to tide over the short term crisis. Its seems not, it seems profits
accumulating year by year in normal times are ring fenced and, well whatever
else they are for, they are not to cover payouts, no no no no.
Imagine that in arboriculture terms. I know (insert clients name here), I
quoted £400 and we done the job all lovely like, but the bill's gone up
overnight to £500, it was a bad week last week you see and we gots to get our
profits from somewhere....
We in the real world all know that that just wouldn't work. Not unless all
arborists were to work entirely too closely together in an unhealthy
monopolistic kind of way. In short we wouldn't be allowed.
Oh my goodness guess what..........apparently the rules covering how people
do reasonable, open and competitive business everywhere else don't apply to
insurance companies.
Something to do with limited numbers of ridiculously large underwriting
companies who all know each other but do business through a myriad of
recognisable insurance companies and brokers (all drawing from and peeing in,
the same pot). Talk about spreading your bets, their's are spread so much, if
they cough we all get a cold!
One further comment on their chosen strategy for recovering their losses. And
please think about that in that way for a moment, they are recovering THEIR
losses for last year, a year in which they projected and collected premiums,
from us!
Anyway, they could have done it another way... . They could have increased
the premiums of the insurance policies that include Terrorism cover placing
the costs of that cover on those who use the service!
Or they could have increased the policy excesses, thereby making the people
who actually have claims make up their shortfall in profits.
Either or some degree of both of these options would be more acceptable to me
and to refer to my conversation with Simon, to him also.
What about you?
I understand that my 28% increase is relatively low but there seems to be
something decidedly unhealthy about this whole situation. Therefore there
should be some interest in this subject. Something for us (still working)
consultants and contractors to bounce around over the holidays perhaps?
Merry Christmas to UKTC, insurance companies and of course those touched by
terrorism (it's cause or effect), I do not wish to be interpreted as being
unsympathetic to their individual tragedies.
David Lloyd-Jones
<:::><:::><:::><:::><:::><:::><:::><:::><:::>
CHESHIRE
ARBORICULTURE
9 Lowland Way, Knutsford
Cheshire, England, WA16 9AG.
phone/fax 01565 621234
www.craftwoods.co.uk
www.arbornauts.com
Inc Cheshire Tree Surgeons
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