We all know that bad news sells and the media seems to love stories from dissatisfied customers when it comes to their insurance policies.  We thought that providing some insight into what choices are out there would give some guidance to anyone considering taking out insurance or reviewing what they already have.

We are all able to purchase insurance online these days, without obtaining advice from an insurance adviser.  We can buy insurance for funeral cover, life and trauma cover, car insurance and house and contents cover, all online or over the phone – but what are the pitfalls?

When we buy online or over the phone, effectively going direct and bypassing an expert insurance adviser, we are led to believe we are getting a good deal with cheaper premiums and can have cover put in place immediately, without having to complete application forms or provide medical information.  This all sounds easy and very attractive to many however, we need to know what some of the traps are and how to avoid them.

• If we want the cheapest premium, we are potentially not getting the best policy.  When we pay for insurance, although we don’t want a disaster to happen, if it does, we want to know that we are going to have our claim paid.  If we’ve picked the cheapest policy with the worst policy wording, our expectations may not be met, and we could be very disappointed!  Some companies have guaranteed policy wording which means they cannot make changes to the cover you have and make you worse off.  On the other hand, other companies do not have that guarantee and can change their customers benefits without the customers approval for example, Southern Cross recently made changes to their covers for existing customers and not for the better.
• If we do not have to provide any medical history details upon application for personal cover, it is likely that any pre-existing conditions we have will be excluded for up to 2 years or permanently.  The older we get, the more conditions we accumulate unfortunately, some major and some minor.  If everything is excluded, the potential for a claim being accepted by the insurer becomes less likely
• When it comes to specialist types of cover, whether this be for personal covers, for business assets, liability cover, cover for shareholders and key people in a business, or maybe marine, aviation or carrier cover, going direct will just not ‘cut it’
• How do we know we’re getting the right amount of cover for the right reasons and at the right price?  Insurance is about insuring the ‘big ticket’ items in life, those incidents that are going to cost us a lot financially.  Surely we want to ensure that our policy has the best wording for such an event and that we have someone who is going to ‘fight our corner’ and look after us if a claim arises?
• This leads us on to explaining the role of the expert – the insurance adviser.  They will of course initially have you sorted with the right policy, the right cover and with premiums that are affordable to you, however, it is when a claim arises that their other skills ‘kick-in’.  They are there for you, supporting you, organising the paperwork, liaising with all parties involved and making everything as simple and understandable for you as possible – isn’t this what we really want when the problems crop up?!  As well as experiencing claims processes ourselves first-hand we have dealt with many claims on behalf of clients, helping to manage and facilitate the process to help relieve the pressure at what is invariably an already highly stressful time.

If you really want peace of mind knowing that in an event you are covered, you need to engage a professional insurance expert.  Insurance of any kind is about putting the right money, in the right hands at the right time – the insurance expert will know how to do this.   The price of going direct, without expert advice, is not worth paying in our opinion!!

Article by Charlene Overell, Authorised Financial Adviser
G3 Financial Freedom Ltd

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