Source: Radio New Zealand
A woman was shocked to discover that her insurance company had increased the value of her car at renewal. 123RF
A woman who was shocked to discover that her insurance company had increased the value of her car at renewal says it is a reminder to people to check what they are agreeing to.
Nicki, who did not want to use her surname, said she had a 2002 Subaru Impreza and a 2012 Suzuki Alto insured with AA Insurance.
But while they were valued at $4000 and $5500 respectively for insurance last year, when it came time to renew this time, the Subaru was proposed to be worth $10,294 and the Suzuki $9600.
She said the maximum excess she was allowed to have had also dropped “massively”.
“We used to be at $2500 per car but the top is now only $1000. I’m unable to get the Subaru’s agreed value reduced back to what it was 12 months ago because they will only insure now for $4375. Allegedly the company feels it must protect us from underinsuring ourselves.”
She was able to reduce the value of the Suzuki.
A higher excess can reduce the premiums that people pay for cover. Nicki was told in an online chat with the insurer that its pricing team had determined $1000 was the most reasonable and accessible amount for customers.
Turners lists a 2009 Subaru Impreza for $5990. A 2014 Suzuki Alto is listed on Trade Me for $5500 and a 2011 model is $4900.
Nicki told the insurer that it was ridiculous that a 24-year-old car would increase in value by two-and-a-half times in a year.
“We cannot be the only ones they’re trying to raise revenue from in these three ways – sum insured increase, excess reduction, refusal to set sum insured appropriately low.”
A spokesperson for AA Insurance said it had recently updated its excess options to ensure that they were “simple and easy for customers to select”.
“Consistent with common industry practice, we rely on an independent third party data provider to provide vehicle values. From time to time, this provider updates their methodology and data sources to ensure the valuations reflect the most accurate and up to date market conditions.
“When this happens, customers may see changes, either increases or decreases, in their proposed agreed values at renewal. We encourage customers to get in touch if they would like to discuss their proposed value or agree on a different value with us.”
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– Published by EveningReport.nz and AsiaPacificReport.nz, see: MIL OSI in partnership with Radio New Zealand
