We are bombarded with Advertising of insurance products that promise low premiums and great service. Think 123.ie, No Nonsense, Chill.ie, Aviva, AXA to name a few.
All of the price competition promised has led to a race to the bottom, that isn’t working for property insurance. In order to make ends meet, Insurers need to contain costs. This has been achieved by cutting claims costs, e.g. imposing higher excesses on water leaks, restrictions on cover, use of notional ‘agreed rates’ of repair which entails the lowest price settlement offer in each area of work, using network builders to agree scope of repairs that are effectively a patch up rather than full repair, and holding of retentions that are increasingly difficult to draw down because the budget isn’t there to get bona fide contractors to do the work to the agreed scope and produce the necessary paperwork to draw down the retention.
The squeeze on claims costs along with increased regulatory and audit requirements has led to a reduction in the number of loss adjusters, increased workload, and longer settlement times.
Satisfaction levels for claims has dropped to new lows causing increased frustration for everyone involved, not least for the all-important paying customer.
It’s hard to watch the adverts for Insurance Fraud and reconcile that with the way some legitimate customers are being treated. It may well be time to ditch the austerity measures, increase premiums and increase the settlements and become more claims friendly.