An Insurance question

[Hightower]

I've just had my policy though and I'd like to reduce the premium.

When I built my RIB 2 years ago I valued everything at purchase value and it's this sum that my insurance is based upon.

Now I know that if I claim on the insurance they will only try and pay the minimum going price at the time of the damage or theft and not new for old.

So with this in mind, I guess I'm over insuring my RIB, what's the best way of calculating the price on my Boat and equipment, to keep me fully insured and to make sure I'm not paying over the odds?

[jambo]

Hi Andy I have just started the process with my insurers as I think I am over valued for what I will get if I made a claim. I am advised by someone that there is a threshold amount where it makeds a difference to the premium but gives the max cover.
I will advise any developments

Billy

[shahid]

Normally an annual depreciation is applicable to the value of your boat (taking into account additions and alterations). Marine Hull insurance is on "agreed value" basis which basically means you and the insurer agree on the value being Insured for.

So when you are making a proposal for a fresh insurance policy, you enter the value you wish to have the boat insured for and if corroborated by a condition & valuation report (if insisted upon) the insurer accepts it and calculates the premium accordlingly.

At the time of a total loss/ constructive total loss claim however, if the market value of the RIB is found to be lower than the amount you insured it for, you will get the market value as prevalent and not the higher sum insured (even though you have been paying a higher premium for a higher value).

If on the other hand the value you have insured it for is lower than the actual market value, they would apply "underinsurance" to proportionately reduce the indemnity amount (on the presumption that in-principle you have insured yourself for the balance amount).

[Nasher]

Originally Posted by shahid

Normally an annual depreciation is applicable to the value of your boat (taking into account additions and alterations). Marine Hull insurance is on "agreed value" basis which basically means you and the insurer agree on the value being Insured for.

So when you are making a proposal for a fresh insurance policy, you enter the value you wish to have the boat insured for and if corroborated by a condition & valuation report (if insisted upon) the insurer accepts it and calculates the premium accordlingly.

At the time of a total loss/ constructive total loss claim however, if the market value of the RIB is found to be lower than the amount you insured it for, you will get the market value as prevalent and not the higher sum insured (even though you have been paying a higher premium for a higher value).

If on the other hand the value you have insured it for is lower than the actual market value, they would apply "underinsurance" to proportionately reduce the indemnity amount (on the presumption that in-principle you have insured yourself for the balance amount).

Or in other words you're fecked both ways, as they'll gladly take your money for the higher amount but won't pay out.

Nasher.

[shahid]

Precisely!

[PeterM]

UK policies for RIBs will very very rarely need a condition report or survey & disagree that hull is unsured on an agreed value basis.

Yes you will be subject to ' average' - the reduction in settlement if you are underinsured.

Best advice - be slightly over insured and keep a good track of market values.

Its worth paying a few quid more to make sure you are properly covered.

Have a try on some of the online quote engines - not much differance in premium for the sums insured. Worth considering the fact that you are paying for liability cover & not just the damage loss of the rig.

Whatever happens insurers will try & screw you !

[Searider]

Some policies will be "agreed value" in which case in the event of a total loss you will be paid the "agreed value". Some policies are not "agreed value" policies. Check your wording.

"agreed value" policies normally a little more expensive.

I would suggest paying a little more to ensure that the level of cover is sufficient.

The area where you're most likely to lose out is if you damage your engine. Gearcases are very expensive! Cost of repairs could exceed the current market value of the engine which will be the most insurers will pay.

When dealing with a claim i've been advised by underwriters that if a "reasonable" customer makes a "reasonable" claim then he will get a "reasonable" pay out - and for me to look at the circumstances of the claim "reasonably" and to report accordingly.

[Hightower]

OK then, I want to be going back to the brokers and asking for an agreed payout insurance for total loss then.

Of course the tricky part is knowing what you boat is "really" worth and finding the threshold between over insurance and under insurance and trying to get my heads around the fact that I will never get full replacement value in the event of total loss.

[Observer]

Originally Posted by Searider

Some policies will be "agreed value" in which case in the event of a total loss you will be paid the "agreed value". Some policies are not "agreed value" policies. Check your wording.

"agreed value" policies normally a little more expensive.

I would suggest paying a little more to ensure that the level of cover is sufficient.

The area where you're most likely to lose out is if you damage your engine. Gearcases are very expensive! Cost of repairs could exceed the current market value of the engine which will be the most insurers will pay.

When dealing with a claim i've been advised by underwriters that if a "reasonable" customer makes a "reasonable" claim then he will get a "reasonable" pay out - and for me to look at the circumstances of the claim "reasonably" and to report accordingly.

I was unfortunate enough to suffer a fractured sterndrive leg in the area of the lower gear (on a twin-engined cruiser, not a RIB) in April 2005. Needed a new leg at total cost of ~£4,000. Cause unknown (the boat was on charter).

Four months later (again on charter), the other leg went (upper gear section this time). Suspected that an earlier incident of a rope wrapped round the prop had weakened or cracked a gear tooth that had later become trapped in the gear causing it to 'explode' the casing. New leg again, this time at total cost of £5,800 including cranage, storage etc

Both times the insurer (same insurer) settled the claim without delay (minus the excess, of course).

I agree insurers will act reasonably if insured's are not taking the p***.

PS - I don't have a sterndrive boat now.