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Your Questions

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Q: Can I insure myself against loss of income?

A: Yes you can, on a Commercial Policy. This will be covered under the Business Interruption Section. This cover is subject to a Fire Policy being in place.

Q: Can I insure my company against shoplifting.

A: Unfortunately not. This is a trade risk and the insurers cannot accept this risk.

Q: Do I enjoy worldwide cover on my mobile phone and laptop.

A: Only if you have specified the mobile phone or laptop under the All Risk section of the policy. When you specify an item under the All Risk Section of a policy you pay an additional premium for that specific item.

Q: Vehicle: Does my short term insurance policy cover me against a mechanical breakdown of my car?

A: No. If the mechanical damage is not as a result of an insured event (peril) that is covered under your Comprehensive Short Term Insurance Policy, you cannot claim for the mechanical damages. If however, you were involved in an accident that caused mechanical damage, your comprehensive policy will cover these damages. There are however specific insurance products which you can take out that offer mechanical breakdown cover. This policy is separate from your Comprehensive Insurance.

Q: Can I insure my vehicle for agreed value?

A: No. Most insurance companies will insure your vehicle either for market or retail value. Some might insure you for the 'book' value (difference between market and the retail value).

One of the reasons why the insurers does not insure you for an agreed value is that it will be very difficult, if not impossible to determine what section of your vehicle was agreed to be covered, if the vehicle needs to be repaired after an accident. Was it only the left side of the vehicle, the right side, the front, middle, back, body etc that was covered? I'm sure you are getting the picture.

Q: Why do I have to pay an excess after having a vehicle accident or my vehicle is stolen?

A: The insurers needs to make sure that there is enough money available to pay for claims. One of the mechanisms put in place by the insurers to manage the pool from which claims must be paid, is excesses.

a) By paying an excess or first amount payable the policy holder is discouraged to claim for small losses incurred. If there were no excesses payable the volume of the claims received by the insurers would increase dramatically. This increase in volume of claims, although the amount for which the policy holder is claiming might be relative low, will result in the pool from which the claims must be paid being drained far quicker. If there is not enough money in the pool, the premiums will need to be increased. Thus the excess principle is to protect the pool from being misused and to protect your premium from not increasing as a result thereof.

b) One of the golden rules for the insured items is for the policy holder to take all precautions and safeguard the risk as if there is no insurance on the insured item. In other words, do not reduce or neglect the safety precautions because you have insurance. Example: Now that you car is comprehensively insured you park it in a high risk area at night where you know the probability is high that they might break into the vehicle or even steal the vehicle. Whereas if you did not have insurance, you would never park your vehicle there. By charging an excess in the event of a loss the insurers attempt to reduce the propability of a loss. If you know that you have an excess to pay, you will safeguard the risk as good as possible within your means.

Q: Why is it that a person under 25 years of age, pay more for insurance? Does that mean that my premium will drop when I get to 26 years of age?

A: The premiums charged by the insurers and the criteria on which they will accept a risk is all based on information which the insurers have gathered over time and are still updating on a daily basis. These statistics are crucial to the insurance companies to determine (1) if they can accept a specific risk and (2) what premium to apply to the risk which they are taking on. These statistics give a very clear indication that all drivers under the age of 25 tend to claim and cause much more accidents than drivers over the age of 25. Besides the volumes of the claims for this age group, the severity of the accidents where persons under the age of 25 are driving (especially with male drivers) is much higher, as these accidents occur while the speed at which these vehicles are driven is high, thus resulting in more damages.

Your age is one of many factors taken into consideration by the insurers. There are many, many more factors that contribute to the premium associated with the risk. These could include your driving experience, the type of vehicle you are driving, the availability and cost of the specific vehicle, etc.

To answer the second part of your questions, in some cases it will make a difference and in other cases no. There are just too many factors that determine your premiums to give you a yes or no answer. However, usually it should make a difference.

We always advise our clients to contact us when they turn 26 to enable us to requote them. This is one of the benefits of having a broker, we are not restricted to one insurance company. At V-Plus we have a panel of a minimum of nine insurers from whom we can obtain quotations for you. Our advice is not bias and our aim is to give you a variety of options and to assist you in making an informed decision.

Q: Why does my premium increase every year, if the value of my vehicle is dropping?

A: This is a good question. Normally the insurers will have a rate increase once a year. The value of your vehicle is one of many factors taken into consideration when the insurer needs to determine a premium. Examples of other factors that must be taken into consideration are the inflation rate, increasing cost of parts and labour, import duties, crime statistics and over all loss ratios of insurers. The insurers monitor these factors on a daily basis and base their decision to increase a premium on these statistics.

It is important for you to make sure that your No Claim Bonus status is amended on your renewal date as this No Claim Bonus status has an effect on determining your premium with the majority of the insurance companies.

Q: Why is my friend paying a cheaper premium for the same amount of goods.

A: The insurance company looks at each individual risk when determining a premium. It might be that your friend's vehicle is more or less the same value as your vehicle, but is not exactly the same make and model. The cost of parts and labour and the availability of parts differ from vehicle to vehicle. Thus you and your friend will not pay the same premium. There are other factors that need to be taken into consideration as well such as age, previous claims history, marital status, area, safety precautions, etc.

Q: What does Comprehensive Cover mean?

A: Comprehensive Cover means that your vehicle will be covered for the damage on your own vehicle in the event of an accident together with the third party's vehicle (other vehicle) damages if you are to be found legally liable for the damages on the third party vehicle. Your vehicle will also be covered if your vehicle is stolen or hi-jacked and in case of fire. Third party damage can also be property and not only a vehicle.

Q: Why do I have to take my vehicle for inspection? A: Unfortunately the insurers had so many cases of fraudulent claims that it became necessary for them to insist on the inspection of a vehicle before your cover starts. This inspection is not only for the benefit of the insurer, but also to you as a client, as this will help you to determine if there is any extras fitted to your vehicle that you need to declare to the insurers. It is important to specify any extras that were fitted to your vehicle to make sure that these extras will be covered under your insurance.

From the insurers point of view, they require an inspection to:

a) make sure that the vehicle does exist;

b) make sure that there is not any old damages on the vehicle. The policy that you applied for and which was accepted by the insurer will only cover you from the inception date or the date of the inspection. Any damage to the vehicle before the inception of this policy will not be covered.

c) make a list of extra's that is fitted on the vehicle when the insurance started. Remember even if the extras are listed on the inspection certificate you MUST specify the extras on your Schedule of Insurance before you will be covered for these extras. It will always be your responsibility to make sure that these extras are insured.

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