Insurance amount is less than settlement amount

Sorry to hijack the thread but also a little confused now :

When I gave the M&M code to my insurance company they came with the correct year, model etc but had the value at R417k. On Autotrader it seems the average price to buy them are around R330k, so I asked her to lower the value to R350k.

If something happens would they pay the R350?
Had I kept the value at R417k, would they really have paid?

My concern would be paying the premium on R417k and if something goes wrong, they decide at the time to pay far less.
 
Dolby said:
Sorry to hijack the thread but also a little confused now :

When I gave the M&M code to my insurance company they came with the correct year, model etc but had the value at R417k. On Autotrader it seems the average price to buy them are around R330k, so I asked her to lower the value to R350k.

If something happens would they pay the R350?
Had I kept the value at R417k, would they really have paid?

My concern would be paying the premium on R417k and if something goes wrong, they decide at the time to pay far less.
Click to expand...

Good question.
 
Dolby said:
Sorry to hijack the thread but also a little confused now :

When I gave the M&M code to my insurance company they came with the correct year, model etc but had the value at R417k. On Autotrader it seems the average price to buy them are around R330k, so I asked her to lower the value to R350k.

If something happens would they pay the R350?
Had I kept the value at R417k, would they really have paid?

My concern would be paying the premium on R417k and if something goes wrong, they decide at the time to pay far less.
Click to expand...


I'd love to get the answer to this.

My understanding is that, in the event of total loss of the vehicle, insurance will pay out between trade and retail value as determined by the M&M books - this value is also used as part of the premium calculations. If you (or your broker)do not advise your insurer, at least on a yearly basis, that the value of the vehicle has decreased, the insurer will continue to deduct premiums that are based on the initial value of the vehicle. If however, you suffer total loss, the insurer will be very quick to refer to current M&M book value and pay out accordingly. This amount of course will be lower than the sum insured and on which you are paying premiums.

Look closely enough at your policy documents and you'll see that it is your responsibility to advise the insurer on a regular basis of the value of the vehicle. The insurer apparently is incapable of maintaining premiums based on current value, but they never fail to use current value on settlement of a claim. Very convenient.
 
Just remember, there are two separate and distinct sets of rights, obligations and relationships:

(1) The set of rights and obligations that arise between the person suffering harm and the person causing that harm.

(2) The relationship between the insured and the insurer.

The extent of delictual rights and liabilities incurred in (1) cannot be reduced by those in (2). If you insure for less than the replacement value of the vehicle, then that is the extent of the insurer's indemnification and thus contractual obligation to the insured. It is up to you to recover the difference, and you have recourse to the courts in a normal Aquilian action.

It is of course up to you to ensure that your agreement with your insurer covers your loss. If the insurer pays to the extent of the indemnification (ito your contract), then of course the insurer acquires subrogated rights to that extent and can act as plaintiff to recover to that same extent from the defendant. You need to look carefully at your agreement with your insurer.

It is a great mystery why people who enter into these agreements don't bother to inform themselves about the Ts&Cs.
 
Dolby said:
Sorry to hijack the thread but also a little confused now :

When I gave the M&M code to my insurance company they came with the correct year, model etc but had the value at R417k. On Autotrader it seems the average price to buy them are around R330k, so I asked her to lower the value to R350k.

If something happens would they pay the R350?
Had I kept the value at R417k, would they really have paid?

My concern would be paying the premium on R417k and if something goes wrong, they decide at the time to pay far less.
Click to expand...

The would pay between trade and retail for the vehicle, regardless of what premium you were paying (if the premium is for a higher value than what they would pay)
 
Your GAP cover insurance will cover it.... you do have GAP over insurance.... right?
 
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Depends on the type of insurance you take. Some insurers allow you to insure it for inception value. Then they would pay out the value it was worth when you got your insurance from them.
 
Dolby said:
Sorry to hijack the thread but also a little confused now :

When I gave the M&M code to my insurance company they came with the correct year, model etc but had the value at R417k. On Autotrader it seems the average price to buy them are around R330k, so I asked her to lower the value to R350k.

If something happens would they pay the R350?
Had I kept the value at R417k, would they really have paid?

My concern would be paying the premium on R417k and if something goes wrong, they decide at the time to pay far less.
Click to expand...

Depends on the type of insurance you take. Some insurers allow you to insure it for inception value. Then they would pay out the value it was worth when you got your insurance from them.

Most insurers do not work this way though.
 
But no where - ever - is it R412,000.00

So on that car take book/retail as R250,000/R340,000 - but the M&M code gave them the higher figure. I have asked her to make it what I feel retail actually is, so it is insured at R350,000
 
Arthur said:
Just remember, there are two separate and distinct sets of rights, obligations and relationships:

(1) The set of rights and obligations that arise between the person suffering harm and the person causing that harm.

(2) The relationship between the insured and the insurer.
r to that same extent from the defendant. You need to look carefully at your agreement with your insurer.
Click to expand...

Some years ago I caused an accident by driving into the rear end of a car. The other parties' insurer sent me a letter for an amount of money to settle. My insurer, Santam, asked for the letter and settled everything. I would think that having comprehensive or third party insurance your insurer will have to deal with the other party's lawsuit. My third party cover is R5 mil per year.

It is a great mystery why people who enter into these agreements don't bother to inform themselves about the Ts&Cs.
Click to expand...

The T&Cs are designed like the laws of thermodynamics: you can never win. Businesses are greedy scumbags. Finacial institutions are ONLY and only out there to screw you over.

It's like dealing with the IoM Barclays Wealth guys. They will BS you how much money your managed fund will make but then when you show them these grand conservative funds actually make losses, they just smile. The fund managers do however rake in the cash.
 
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Yup.

Most vehicle insurance providing cover for damage to third party property is typically a full indemnification, though some do specify a ceiling. Best to check the policy carefully.

And don't even talk to me about IoM investment managers, lest I spit all the way to Iceland. I was caught up in the Kaupthing fiasco.
 
She said they pay retail - and according to the M&M code supplied :

2010 Audi S4 3.0 TFSI Quattro (B8)

R414 700-00
Private use
Car hire included
Premium per month : R1296-28

I dropped this to R350,000 and the premium dropped to R1,094.00 - and said I didn't want top up at the dealer. However I'm thinking of just going to back to value they say and paying the R202.00 extra which is essentially my top up
 
Dohnner! Your insurance costs the same as my insurance on two cars + monthly fuel cost for the one.
 
You can't drive very far at the cost of todays petrol ;)

What is your insurance?
 
R600 at M&F for a 2010 Corsa Essentia (R120k) and a 2001 Astra CS (R40k). I cycle to work most of the time because I do not agree with the price they ask for petrol as of late.
 
Rouxenator said:
R600 at M&F for a 2010 Corsa Essentia (R120k) and a 2001 Astra CS (R40k). I cycle to work most of the time because I do not agree with the price they ask for petrol as of late.
Click to expand...

add about 150 then that is insurance for 2 vehicles (total value about R380k), one of which is a V6 3.3l engine, the other a cheapy run around. AND household content included.

So I guess my monthly payments are not so bad then :)
 
Dolby said:
She said they pay retail - and according to the M&M code supplied :

2010 Audi S4 3.0 TFSI Quattro (B8)

R414 700-00
Private use
Car hire included
Premium per month : R1296-28

I dropped this to R350,000 and the premium dropped to R1,094.00 - and said I didn't want top up at the dealer. However I'm thinking of just going to back to value they say and paying the R202.00 extra which is essentially my top up
Click to expand...

Flip thats a lot.
 
Dolby said:
She said they pay retail - and according to the M&M code supplied :

2010 Audi S4 3.0 TFSI Quattro (B8)

R414 700-00
Private use
Car hire included
Premium per month : R1296-28

I dropped this to R350,000 and the premium dropped to R1,094.00 - and said I didn't want top up at the dealer. However I'm thinking of just going to back to value they say and paying the R202.00 extra which is essentially my top up
Click to expand...

Did you get that response in writing?

If so, write your car off, then go buy a new toy and have a bit of spare cash.
 
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