Personal insurance
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Understanding Insurance Types
- Insurance policies vary widely — always check what is covered, what is excluded, and the claim limits.
- Most policies are ‘contractual promises’ with strict definitions. Small wording differences can change outcomes.
- Premiums are based on risk information you provide. Inaccurate details can lead to claims being reduced or declined.
- Excess, limits, and conditions matter as much as the headline cover.
- Renewal is a key moment to review cover, not just price.
How Insurers Price Risk
- Premiums are based on probability (how likely a claim is) and severity (how costly it could be).
- Insurers use rating factors (for example postcode, claims history, and vehicle type) to estimate risk.
- Your premium can change at renewal even if you haven’t claimed — because market costs and risk models change.
- Small changes to excess, security, or cover limits can change your price materially.
- Accurate information is essential — incorrect details can affect both price and claims outcomes.
Excess Explained
- Excess is what you pay towards a claim before the insurer pays the remainder (up to policy limits).
- Most policies have a compulsory excess; many also let you choose a voluntary excess.
- Higher excess often reduces premium, but increases your out-of-pocket cost when you claim.
- Some claims may have multiple excesses (for example escape of water + accidental damage).
- Always check if excess applies per claim, per incident, or per section of cover.
Claims Process Explained
- Report claims promptly and follow the policy’s notification rules.
- Gather evidence early: photos, receipts, timelines, and police reference numbers where relevant.
- Insurers may repair, replace, or cash-settle depending on the policy and circumstances.
- You may be asked to minimise further loss (for example, temporary repairs to prevent additional damage).
- If you disagree with a decision, use the complaints process and ask for the policy wording relied upon.