Motor Insurance: Windscreen Cover

 

 

By law you must have motor insurance to drive your vehicle on roads in the United Kingdom. This requirement has created an industry which is currently thought to be worth an estimated £9.4 billion a year. In short, you need insurance, and the providers want your business, but who does this obligation really suit?

Consumers are always looking for value for money, and sellers are constantly looking at different ways to provide it, especially in a competitive industry; gaining that edge to attract more business can cause confusion in the marketplace. With so many benefits and bolt-ons to consider one area which is not so clear (until a claim is made) is windscreen – or glass damage – cover.

Documents

So much paperwork

To be fair to all prospective insurers, there’s a lot to discuss and they are required to follow a strict code of conduct as laid out by various regulatory bodies related to the various aspects of their industry. The aim of Insurance Conduct of Business Sourcebook (ICOBS) is to ensure that customers are treated fairly. One section in particular is one which some might feel is not being observed. ICOBS 6.1.5 states:

 

“A firm must take reasonable steps to ensure a customer is given appropriate information about a policy in good time and in a comprehensible form so that the customer can make an informed decision about the arrangements proposed”.

 

 

Before policy inception, the proposing insurer should make clear the relevant, and salient, points which would apply in the event of a claim. Did your insurance company (or broker) do that? Did you feel furnished with the facts? If you were comparing the market on a price comparison website (PCW) perhaps not. Or perhaps you just confirmed that you have “read and understood” the Terms & Conditions (a usually tedious read of strange words used in an unfamiliar format or convoluted syntax). Or may be you were swept along by the user-friendly wave, washing you up at the checkout before you knew it? In some cases, there will be some disclosure before a decision is finalised.

Vague

Ambiguity

 

In the example shown, it wasn’t clear where the additional details would be found as it wasn’t in the “Policy Summary”. There was no mention in the “Schedule” either, and just to add to the confusion, there was no “Policy Booklet”. A bit more reading and searching revealed a small box in a very generic-looking table of contents found on a ‘Key Facts’ document which had no reference to the vehicle, or proposed policy:

 

“Call the <insurer name> Glass line on <number> and your windscreen will be replaced subject to a £60 excess. There is no excess if the windscreen can be repaired rather than replaced. See section 8 of the policy book for full details.”

 

 

Including the covering letter, there were a total of 20 sheets of paper in this particular proposal, but no ‘policy book’. Furthermore there is nothing to indicate anything even close to resembling a booklet, or indeed anything replacing a booklet resembling a series of pages with at least eight sections amongst them. At this point it is worth remembering what ICOBS 6.1.5 states, “A firm must take reasonable steps to ensure a customer is given appropriate information about a policy in good time and in a comprehensible form so that the customer can make an informed decision about the arrangements proposed”. Meanwhile, all this is taking place during your lunch break as you rack up your inclusive minutes on your mobile phone as you remain engaged and locked into calling a non geographical telephone number.  Even asking the seemingly helpful telephone staff to clarify what exactly ‘unlimited cover’ means, and what would happen in the event of a claim, is futile, “It means the underwriter will pay for the cost of replacing the damaged glass.” Notwithstanding the glaringly obvious, but the word ‘unlimited’ in this context might appear irrelevant, or redundant. And herein lies the issue.

There is:

  1. a Renewal Notice covering letter;
  2. what appears to be a (somewhat presumptuous) thank you (for choosing to renew) letter;
  3. a Statement of Fact document;
  4. a Statement of Demands and Needs document with a summary of cover on the reverse;
  5. two pages of a Key Facts summary (which appears to echo the preceding documents!)
  6. a Direct Debit information document;
  7. a Terms of Business page consisting of lots of smallprint;
  8. a four-page copy of a ‘Motor Legal Expenses Insurance’ booklet;
  9. eight pages of the Terms & Conditions pertaining to breakdown cover.

There is not anything to explain the process of claiming for glass damage.

In failing to define the outcome of initiating a pending claim by not stating that they will steer you into using their nominated repairer, they are not presenting you with an important fact of a policy (of which you might be about to enter into a contractual agreement with the insurer over). Is it not a good time before the terms are accepted and agreed, and a transaction is completed to disclose that there is a preferred supplier restriction in place, and that the policyholder will only be indemnified for part of the loss should they choose their own repairer?

Smashed Windscreen

Windscreen Damage

At the time of discussing these finer details of the proposed renewal in this instance, there was no clarification available. It is not a training issue either. The insurer’s representative should be in a position to present the facts, yet all they could state was something quite vague and ambiguous. It’s is too easy for the insurer. There appears to be very little focus on what the consumer wants, or deserves, as the deal is weighted in favour of the insurer. Meanwhile, the insured walks away with a cheaper deal (which, when you consider the hidden – or non-disclosed – restrictions re repairers and claim limits perhaps explains why the deal was cheaper).

Expanding on the adage that ‘you get what you pay for’, it is time that consumers insisted on clarifying exactly what it is they are paying for before policy inception rather than after an incident which leads to a claim.

It’s time to be wise before the event.

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