Small oversight – big cost

Steve* started his new road freight transport company in June 2019. He did the smart thing and took out all the insurance he needed through a broker.

But two months later one of his trucks was involved in a bingle and hit from behind. Steve wasn’t at fault, but he went ahead and lodged the claim through his insurer’s 24-hour hotline.

The insurance company told him to pay his $1,837 excess, which he promptly did.

Luckily, there was no damage to his truck, and the third-party loss was successfully denied by the Insurer.

Bonus.

The insurers refunded the excess and Steve got on with running his business. He didn’t think another thing about it – until his renewal arrived.

Bill shock

Not only had his no-claim bonus been wiped, but his premiums had also increased.

Steve still hadn’t thought to tell his broker about the accident. Brett only found out when he requested a copy of the claims’ history, standard procedure for all renewals.

He jumped on the phone to Steve to find out what it was all about.

“But I wasn’t at fault,” Steve pointed out.

Examining the details

Brett looked closer at the claim. There was a nil cost to the insurer, and the claim cost was under the excess amount.

As the Insured was not at fault, and the third party damage was under the excess, the insurer had no right to reduce Steve’s no claim bonus. After all, it’s a no claim bonus, not a no loss/accident bonus.

Success!

Brett got on the phone to the insurer to argue Steve’s case, and after a few rounds of back and forth calls over the day, the insurer agreed.

Steve got him no claim bonus back – saving over $1,300 on his renewal. A significant saving for the business.

Keep your broker in the loop.

Your broker is there to help.

When possible, go through them when you have a claim. Your broker can see who’s at fault and if you even need to pay your excess.

In Steve’s case, he could have avoided lodging a claim and paying his excess. And that would have saved the mix-up that saw him spend his money at a critical time and potentially lose his no-claim bonus.

Your broker knows all the ins-and-outs of your insurance. They can deal with the insurer for you and follow up with any claims. It saves you the hassle and lets you focus on your own business.

Of course, if it’s an emergency, the 24-hour hotline offered by insurers is fantastic peace of mind. But remember to contact your broker ASAP and let them handle it from there.

In a nutshell, always let your broker know of any claims you make. A good broker should check your claims history with you at renewal time, but you also need to do your part in keeping them updated.

* Name of the owner has been altered to ensure client confidentiality.