Car insurance scam?

Last week, driving along a main road in slow moving traffic in a Port of Spain suburb, I suddenly felt a heavy impact on the left side of my car. An SUV had pulled out from a side street and collided with us. Only five minutes earlier I had moved my nonagenarian mother from her customary back seat on the left to sit behind the driver’s seat.

The damage to my car is extensive — both doors wrecked, the frame of the back door connecting to the wheel frame and roof is irredeemably buckled, the front door frame had shoved the front bumper out of alignment, and the back tyre is rubbing on the partly collapsed wheel arch.

The humbug from that second of inattention by the other driver is inestimable.

Having comprehensive insurance turns out to mean very little.

The claims clerk explained to me that since my car is no longer new, even with only 13km on the clock and in perfect condition, I would have to pay depreciation on the cost of repairing the damage since the parts to be fitted “would be newer than the rest of the car.” If I chose to go to a body “straightener” who would access “used parts” then there would be no depreciation payable.

If I went to VW, as I want to because other repairs are needed, then I would have to pay. And the explanation for this bizarre logic is that I have no “new for old” on my policy, something in car insurance that I had never heard of until that moment.

A couple of calls around and I soon learned that nobody has used VW parts lying around and they, like the not-to-be-favoured VW Body Shop, will need several weeks to get them in.

Considering the cost of repair and the near new condition of my car, the deprecation charge is going to be $3,300.

In addition, I apparently don’t have “loss of use” on my policy so that I will be car-less during the two-week repair, and insurers don’t claim from one another for that.

So, here I am, totally blameless, and now facing financial hardship, which I thought I had paid to avoid. With an elderly person needing frequent medical visits, what am I to do? I asked several people who have new, comprehensively insured cars what they thought they are covered for. Not one knew about the “new for old” or the “loss of use.” We have misplaced confidence that we are fully covered.

There has to be something fundamentally wrong when so many intelligent and experienced drivers are misguided. Simply, it is that insurance companies are guilty of mis-selling.

Each year when we go to pay our premiums it should be every company’s duty to ensure their clerks, rather than acting as mere money collectors, make customers aware of changes to insurance cover and advised on the appropriate level of insurance.

If companies notify clients in its renewal notices then it is not evident enough to draw our attention.

We must suspect intentional obfuscation. Insurance companies are unpopular because they want to pay out the least while customers want maximum redress. They are impenetrable because they flood their communications and policy documents with legalese. And, they seem untrustworthy because we can rarely rely on them in times of need. With the group I am insured with doubling after-tax profits last year they can afford to do better and government watchd o g s s h o u l d demand b e t t e r p e r f o rm a n c e from the i n s u r - ance sector.