Sunday, 23 July 2017

Beware! Big Home Insurance Providers On A Claim Rejection Spree

Written by Posted On Monday, 13 February 2017 10:37

 

 

 

According to the latest reports by the Financial Conduct Authority (FCA), many big insurance providers are likely to refuse payout for home insurance claims. The City watchdog has published a pilot report giving names of insurers which are the least likely to accept customer claims. The report was generated to create awareness for the general public and to make sure that the insurers rethink and create strategies that are beneficial for their customers. Expectedly, this will help people find better alternatives if they are not happy with their insurance provider.

According to Christopher Woolard from the FCA, the publication is aimed at making the insurers more sensitive towards their customers. He expressed his view on the report by saying that “We want stakeholders to have access to a wide range of information about the value of general insurance products that goes beyond price. We expect the pilot publication to help incentivise firms to improve the value they offer consumers. The pilot will allow us to refine the value measures and obtain further evidence of the effectiveness of these measures ahead of any potential consultation.”

Talking about the report, some big names were on the forefront of decliners of home insurance claims. Some of the companies with the lowest acceptance rates are Co-Op Insurance, LV=, Axa Insurance, L&G, Allianz and more. These companies are amongst those which occupy the top ten places with the lowest claim frequency for claims made on both building and contents policies. Furthermore, the first three companies mentioned here show a track record of paying 80 to 84.9% of claims by August 2016.

On the contrary, some of the companies manage payout for more than 90% of the claims made by the customers. Insurers which payout 90 to 92% of claims are Aviva, Zurich, Tesco, Lloyds, MS Amlin etc. Hiscox, Liberty, Chubb and Royal & Sun Alliance, which all make payout on 97.5% to 100% of home insurance claims. The report also gave details about the average amount of payout made by various companies. While Axa paid between £2,500 to £2,999 as an average payout, Lloyd paid a higher amount of £3,500 to £3,999.

Table below gives details about insurers making the highest and lowest payout:

Highest & Lowest claim acceptance rates of insurance providers:

Company

Claims acceptance rate

Average payout

Axa

80% to 84.9%

£2,500 to £2,999

LV

 

80% to 84.9%

 

£3,000 to £3,499

Co-Op

 

80% to 84.9%

 

£2,000 to £2,499

L&G

85% to 87.4%

 

£1,000 to £1,499

 

Allianz

 

87.5% to 89.9%

 

 

£2,500 to £2,999

 

Hiscox Syndicate Ltd.

97.5 to 100%

£70,000 to £75,000

Liberty Insurance Ltd.

97.5 to 100%

£2,000 to £2,499

Chubb/Ace European Group Ltd.

97.5 to 100%

£10,000 to £14,999

Hiscox Insurance company Ltd.

97.5 to 100%

£10,000 to £14,999

Royal & Sun Alliance

97.5 to 100%

£1,000 to £1,499

 

Shay Ramani, founder of FreePriceCompare.com articulated his views on the FCA report by saying that “While all insurers have their reasons to accept or reject claims, the FCA data would certainly make an impact on the reputation of the companies. It will also affect their thought process to help them make strategies that benefit their customers. Customers should check the data to get an idea about the insurance provider and its frequency of accepting or rejecting claims.”

To sum up, by studying the FCA data, you can gauge the chances of your claim being accepted or rejected by a particular insurance company. It will also help you to decide whether you want to purchase insurance from any of these companies or not. Basically, shopping around is a very helpful method to weigh your insurer before forming an association with them and buying a policy.

 

 

 

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Maulik Virparia

Maulik is a passionate learner and keep updated himself with all latest regulations and updates from UK Government. At the same time, he keeps eye on industry veteran's opinions and views on UK realty market.

He writes on important updates from the market with an aim to aware UK households.

www.3iinfo.co.uk
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