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Policyholders selective disclosure

30 Nov 2016

Policyholders selective in what they tell their insurers according to a survey by IAG New Zealand. As part of the ‘IAG Safety Insights Monitor’*, the survey was carried out in June this year. It asked 800 Kiwis what situations would prompt them to contact their insurer.

Drivers in New Zealand are in no hurry to let their insurer know about traffic convictions. One in five of them (20%) would confess to being slammed with speeding fines and other charges before their policies come up for renewal, the survey showed. However, 33% would actively update their policies if they made modifications to a vehicle.

The results also showed that just under half (44%) of policyholders would bypass telling their insurer if they had an extra person under the age of 25 years old driving their car.

Mr Chris Kiddey, National Technical Specialist at IAG, which owns State, AMI, Lumley and Lantern, said that the policyholder does not have to call if a person under 25 is driving the car as the average motor vehicle policy does not have an automatic restriction for young drivers, but policyholders can sometimes choose a restriction in return for a discount and that requires them to call the insurer when a person under 25 is driving the car.

Car modification

He added when it comes to car modifications, it may depend on the value of the upgrade.

“Usually you won’t have to notify your insurer until your policy renews, but better safe than sorry: if in doubt, make the call,” he said.

Health condition

The survey found that three in five us (60%) would declare a health condition that affected their driving skills, such as having to wear glasses while behind the wheel

“You don’t necessarily have to tell your insurer about this,” Mr Kiddey said. “But be careful: if you legally can’t drive and you have an accident, you may not be covered”.

High-value purchase

A pricey purchase emerged as the most likely reason why customers would touch base with their insurer.

Almost two thirds (65%) would update their policy to include an expensive new item, such as a piece of art or jewellery or a coin collection.

Women are marginally more likely than men to protect their more precious assets, with two in three (66%) of women saying they’d ring in a new purchase to their insurer, compared to slightly fewer men (63%).

“When you buy something expensive, you should call your insurer,” Mr Kiddey said. “Virtually every standard policy has limits payable for items such as these.”

Paid guests/flat mates

Two in three people (68%) would have paying guests in their home without changing their cover, which could leave some people being vulnerable should a tenant or guest cause damage and they need to make a claim.

However, Mr Kiddey said this should not usually be a problem if the policyholder is also living in the home.

“But many policies can limit cover for rental homes or even exclude certain types of damage,” he said. “Best to ask before hand!”

Renovations

Fewer than a third (32%) saw a need to let insurance companies know about renovations being made to a kitchen, bathroom or any other part of their property.

“A coat of paint, new fixtures, redoing the lino, minor things such as these are no problem,” Mr Kiddey said.

“But let your insurer know if you’re doing anything structural – you may not be covered for any related losses.”

He said that policyholders must call their insurer if they are doing major home extension work, even though less than half (49%) of respondents said they would.

The survey results are based on an online poll of a representative sample of the national population aged 18 plus, conducted from 17 to 24 June 2016 by Trace Research.

 - eDaily

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