When the system breaks

I lose some sleep and wake up thinking about yesterday’s “loss.”  Not really a loss more like a time where everything seems to match up but it just doesn’t.  Everything is there;

  • was referred by a trusted person(is there any better way)
  • has been with me a few years(yup, 98+% stay)
  • had actually met in person(shocking but happens)
  • helped with a non-insurance thing(helped get one a job)

So you go into the renewal time ready to follow the plan and this time it doesn’t work.  Factually the overall plan always works.  But, within that plan, sometimes the sub-plan doesn’t get the expected result.  Take the other set of circumstances;

Claim Economics

Had a call about a claim this weekend.  No big deal, part of the business.  An awful, annoying and very, very broken piece of the business but part of it.  So the usual;
Is everybody ok?  Yes
What happen?  other person hit me, admitted fault and police were called **REAL good news but must be handled properly**
Then what?  Call the other company, not yours….
Etc. etc. More posts here and here and here

Here is what I thought about though.  Both companies have the money ” in the bank” to pay this claim.  So what do they lose?  Well they plan on this anyhow and the reality is, if done correctly, it is really just a marketing activity.  This is your chance to jump over price and cement a relationship but instead both the paying and the non-paying company will likely negatively impact both the person who is at fault and who isn’t.

WHY!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!
Baffled by the economics of this since we have already committed a lot of money to an underwriting philosophy that made this customer one that we want.
Baffled at why an industry would allow the occurrence of one claim where a person was deemed completely not at fault to override several dozen other factors.
But, then again, this is likely just another example of how having clear goals, appreciating humans and allowing morals, ethics and philosophy to blend with technology is really just the next frontier.

Rethinking claims and the causes

***Working thought, from an idea via a longtime friend***

So the scenario is quite common, friend calls and says they want to have some tree work done on their property.  Pretty common.  You can also insert, new roof, new furnace, upgrade to electric panel, drainage dug, fire alarm installed, etc.  Think of it as any proactive, likely preventive measure that can reduce the likelihood and at worse the severity of a claim.

“Bill, is there an extra discount for cutting down the trees?  Will they(the insurance company) pay for it?  ”    No and No.

The real cost of a claim is

much more than the money you are given.

10:00 Thusday August 22nd my car was hit.  I was deemed 100% not at fault and only suffered a small cut and a few hours of soreness.  This is being written 23 days later and my car is still in the shop.

Yes, I have a rental and have had it available since the day of the accident.

Yes, I have no out of pocket expense for this accident since I am not at fault.

No, I am not terribly please with this whole claims process.

Dear Enterprise Rental Car,

8/29/13

I had an unfortunate moment last Thursday when my car was struck by another one.  Now that I have had some time to relax and think I thought I would right you a letter.  I believe that if you are going to hand out feedback you need to be willing to share good and bad.  DISCLAIMER, I have been haphazardly recommending you for about ten years since a previous employer had arrangements with you.  Shame on me.

It’s renewal time, what do you do first?

So the paperwork for my renewal came in the mail this past week.   Just like millions of other people I went and looked at the rate.    So now what?  Well here are some things I look for in my own renewal, as well as yours when I have the chance to renew it;

  • Is it correct?  Yes, is it correct.  Is my name spelled right, are the right vehicles there are all my discounts correct.  Before you think about the rate lets make sure the basics are correct.

Do YOU trust your agent?

Do you trust your agent enough to get a second opinion?

How about asking your agent what coverage they have and taking a look at their declarations pages?

Sounds like fun to me, let’s see if your agent has full no-fault coverage.  Let’s see if they have matching liability and supplemental coverage.  Let me know how it turns out.

UPDATE 5/14/2015

It has been over four years since this first post.  Sadly, the majority of times I review a policy I end up saying;

I’m not saying it’s bad. I’m just saying I wouldn’t sign my name to it.”

How to take control of your claim

Step 1.Remember why you have insurance, it is not for the little annoying thing that you can comfortably afford to fix.  It is for the event that you need help paying to fix.  Filing a claim because  “I pay for insurance why shouldn’t I use it…” can get you in to trouble. **What is trouble?  Trouble is having rates on the higher side of the market for at least three years**

The Anatomy of a Car’s Value

2003 Volkswagen Jetta GL:  So according to KBB.com  the Good Trade in Value is $1700 and Fair is $1125 so maybe I am around $1500.  Now private party says $3225 and Fair is $2525, let’s keep being reasonable and say $2875 as private party we won’t use retail because this car is not in excellent condition.

How about Edmunds?  A little different process here comes up with $2734 as a trade in $3752 as a private party, same thing here retail seems a bit high.

So KBB average with my adjustments is $2187.50 and Edmunds is $3243  that is about a $1000 difference.