Retail value Insurance

[*SynergyX*]

Hi Guys

Should insurance premiums go up year on year until the end of life of car for retail value insurance?
or could they be reduced after 2-3 years?

Thanks.

 

[SinghDude]

The value of the car is just one of the many variables that determine the cost of insurance.


Remember that the cost of replacement parts continue to escalate above inflation annually hence premiums are likely to be adjusted accordingly.

Also in general claim ratios across the industry continue to suffer with abnormally high rate of claims, hence all parties suffer by paying higher premiums.



What you can do however is to scout other insurance companies that want your business, it is very likely you could get a lower premium.

 

[Hemi300c]

Insurance premiums are based on various factors and here are some but not all:-
Claims experience
Value of vehicle
Losses in the area the vehicle is used or parked
Losses in the use description/business of the vehicle
Losses for that specific vehicle/Accident and theft
Losses for the drivers age group
Drivers age
Length of holding a drivers license
Other drivers listed as drivers and all their criteria
Price of spare parts
Availability of spare parts
Overall losses for the insurer
Etc etc

Some insurers are easy to give you a great premium upfront to get you as a client but then recoup the premiums by increases

I suggest get a good broker that will manage this for you and advise you accordingly.

PS Only take advice from a approved Financial Service Provider as it is actually illegal to give advice if you are not approved.

 

[*SynergyX*]

what im confused about and need some explanation on is if i bought the car for say R100 000 in 2013 and its insured at retail value.
is it still insured at R100 000 in 2016 - and that what will get paid out?

 

[Hemi300c]

what im confused about and need some explanation on is if i bought the car for say R100 000 in 2013 and its insured at retail value.
is it still insured at R100 000 in 2016 - and that what will get paid out?

Nope you will only get retail value out with any extras not factory fitted and if specified on the policy.

What vehicle is it and are you sure the retail is and was correct at time of insuring?

 

[*SynergyX*]

ok - i tried speaking to the insurer but getting info out of them is rather difficult...

not to go into too much detail.. the car was bough brand new in 2013. it was insured at the purchase price X on the day of purchase.
for the next 3 years i have received renewal letters stating the insured value is still X (the purchase price)

is this correct? so you are saying the i wont be paid out X although the contract states that is the value insured?

 

[SinghDude]

Vehicle bought brand new would almost certainly result in depreciation.

Retail value will be reduced accordingly.

 

[Hemi300c]

ok - i tried speaking to the insurer but getting info out of them is rather difficult...

not to go into too much detail.. the car was bough brand new in 2013. it was insured at the purchase price X on the day of purchase.
for the next 3 years i have received renewal letters stating the insured value is still X (the purchase price)

is this correct? so you are saying the i wont be paid out X although the contract states that is the value insured?

Nope, probably not correct. Get the retail value and tell them to insure for that and you expect a refund for the incorrect value they insured it for. I doubt it'll transpire, the refund, but it'll get their attention.

PS, I suggest look around for a better option and work through a broker. A broker will/should review your policy every year with the correct retail value.