Specifying items on application
Following a recent telephone survey of 268 Brokers and as part of our ongoing improvement in service levels we want to assist you, at point of sale, with meeting your customer's demands and needs on covering specified items.
The survey asked:-
- Are you aware that there is a difference on specifying items under contents and personal possessions? - 18.28% were not aware
- Are you aware that specifying contents decreased the value left of the contents sum insured? - 32.08% were not aware
- Are you aware that specifying contents does not give their customer greater cover for those items? - 15.29% were not aware
- Are your customers clear that by specifying contents cover is restricted to the home? - 9.32% say customers are not clear
- 85.44% - stated that a communication around this area would be helpful.
We listen - and we have taken all your responses on board and hope to up date our processes in due course to suit both yours and our needs.
In the meantime it may assist you to, when clarifying what cover the customer needs, on specifying an item under contents or personal possessions to show (c) or (pp) after the item specified on the application. This then shows that you and the customer are aware that the item is covered under contents or personal possessions, and also allows you to quote the correct premium.
Very important - If the customer elects only to specify an item under contents it should be made clear that the item is only covered for the contents insured perils, and that the £40,000 sum insured decreases in respect of the remaining contents.
| Example: |
Specified Items |
Piano |
£5,000 |
| Watch |
£2,000 |
| Painting |
£2,000 |
| Table & Chairs |
£6,000 |
| Total |
£15,000 |
If the insured has selected standard contents cover, this means that they only have £25,000 left to cover the replacement cost of the rest of their contents. This may be inadequate, and may not meet the customer's demands and needs.
Remember - In these circumstances we can offer B&C Extra - £60,000 sum insured
This is also very important for Paymentshield so that we can always underwrite the insurance on the correct basis, show the cover selected more clearly on the Certificate of Insurance and for your customer at point of claim.
Personal Possessions cover is selected as an addition to Contents and gives cover outside and inside of the home, including Accidental Loss.
So if the customer wants to insure their Rolex watch - £2000 (pp) but also wants to insured their unspecified items, ie camera, sports equipment, clothing, baggage, etc - £3000 (pp), the total sum insured for Personal Possessions should be £5000.
| Example: |
Specified Items |
Rolex Watch |
£2,000 |
| Unspecified |
£3,000 |
| Total |
£5,000 |
If the insured has selected standard contents cover plus Personal Possessions this gives a total sum insured of £45,000. This also protects the contents sum insured and reduces the possibility of the customer being under insured.
Mid Term Amendments should operate in the same way, and we would be grateful if you could please confirm specifically what cover is required when adding any specified item, ie (c) or (pp).
From improving our Underwriting we hope you can see everyone is a winner.
- CC557