Insurance offering vouchers instead of cash

[strumpusplunket]

I'm not sure if this is in the right sub-forum, but it's regarding insurance so perhaps it fits best here?

Anyway, I claimed on insurance for a lost P20 Pro. The claim has been approved (after a couple of weeks or back-and-forth emails thrashing out the circumstances), but the insurer has just emailed to say they will pay out in vouchers for Apple, Amazon or Currys.

Now I am not pleased about this since I've already bought a replacement phone (I couldn't be that lone without one) and the vouchers aren't going to pay off the credit card I bought this on.

I here this is becoming common practice even though it's come as a surprise to me. Has anyone had any experience of this - and of requesting cash instead. Using any of their selected suppliers would put me at a disadvantage even if I still needed to buy a phone since they are definitely not the cheapest place I could purchase from.

This is a right PITA, really.

 

[Destination]

Interesting.
Who is the insurer?
I thought most made payments only direct to bank accounts, after you had signed the forms to say it is complete and no further claims will be made.

 

[strumpusplunket]

It's Cedar Tree. Not sure I'll ever use them again. I've found the whole process a right faff.

I had a quick Google after getting the email and it does seem more and more insurers are doing this as they get discounts with their preferred suppliers. On the one hand the point of insurance is to put you back where you were before a claim, so with that in mind if you could get a replacement item from their preferred supplier then that fulfils their remit. But on the other hand, I don't think use of their preferred supplier should leave the insured at a disadvantage.

I've heard that some insurers knock off their supplier's discount when converting offers to cash. I would not be happy about this, and I can't see anything about the offer of vouchers in the policy wording.

 

[crinkleshoes]

I had this with Axa... they offered vouchers for the full price, replace the item for me, or cash at their cost price... which was a good 15-20% under market rate.

I didn't renew with them & moved to a better insurer.

 

[strumpusplunket]

I had this with Axa... they offered vouchers for the full price, replace the item for me, or cash at their cost price... which was a good 15-20% under market rate.

I didn't renew with them & moved to a better insurer.

Yeah, it sucks. I was just wondering if there are grounds for insisting on the full cash settlement if you can argue having to use their preferred supplier disadvantages you. Don't know if anyone's tried that? I will be giving them a call in the morning, but am prepared for the run-around, frustration and disappointment...

 

[crinkleshoes]

Yeah, it sucks. I was just wondering if there are grounds for insisting on the full cash settlement if you can argue having to use their preferred supplier disadvantages you. Don't know if anyone's tried that? I will be giving them a call in the morning, but am prepared for the run-around, frustration and disappointment...

I'm sure you could... but they might have something to work against that in the T&Cs you agreed to when you took the policy out... check the policy wording.

If it's not stipulated in the policy wording, then go for it & threaten with ombudsman.

 

[strumpusplunket]

I'm sure you could... but they might have something to work against that in the T&Cs you agreed to when you took the policy out... check the policy wording.

If it's not stipulated in the policy wording, then go for it & threaten with ombudsman.

I can't see anything in the policy wording. I've tried searching various relevant terms and can't see anything there.

I may well threaten the ombudsman, but I've not idea where they'd come down on this issue.

 

[crinkleshoes]

I can't see anything in the policy wording. I've tried searching various relevant terms and can't see anything there.

I may well threaten the ombudsman, but I've not idea where they'd come down on this issue.

One of the main points of insurance is that it puts you back in the financial position you would have been in, had you never needed it.

With the expection of certain policies which only insure you against percentages or other limits, which would be agreed prior to taking out the policy.

If you can demonstrate that their method of remuneration disadvantages you, then go for it...

The thing I'm not sure where they would stand on is... you couldn't wait until the claim was complete and replaced your phone early. I know the reasoning for it, only they might be "tough luck, you should have waited" or something.

 

[strumpusplunket]

One of the main points of insurance is that it puts you back in the financial position you would have been in, had you never needed it.

With the expection of certain policies which only insure you against percentages or other limits, which would be agreed prior to taking out the policy.

If you can demonstrate that their method of remuneration disadvantages you, then go for it...

The thing I'm not sure where they would stand on is... you couldn't wait until the claim was complete and replaced your phone early. I know the reasoning for it, only they might be "tough luck, you should have waited" or something.

Yeah, that's pretty much what they said on the phone. I tried the line about their preferred suppliers disadvantaging me, and they said to put it in writing to management. So I guess that would take ages not to go anywhere.

I guess I can at least sell the viuchers for not too much loss.

I know Swinton just send out a cheque in these circumstances. Think I'll stick with them for insurance in the future.

 

[Jonnybmac]

Worse case can you not take the Amazon vouchers and sell them for 5/10% less than the price

 

[strumpusplunket]

Worse case can you not take the Amazon vouchers and sell them for 5/10% less than the price

Yeah, guess this is now my best option.

 

[Psycho Sonny]

One of the main points of insurance is that it puts you back in the financial position you would have been in, had you never needed it.

With the expection of certain policies which only insure you against percentages or other limits, which would be agreed prior to taking out the policy.

If you can demonstrate that their method of remuneration disadvantages you, then go for it...

The thing I'm not sure where they would stand on is... you couldn't wait until the claim was complete and replaced your phone early. I know the reasoning for it, only they might be "tough luck, you should have waited" or something.

how does that work when the excess is always going to put you at a financial disadvantage compared to not needing it.

 

[crinkleshoes]

how does that work when the excess is always going to put you at a financial disadvantage compared to not needing it.

That's one of the agreed terms. You wanna look at that, how about the cost of the insurance in the first place?

My home insurance policy has £0 excess.

 

[Psycho Sonny]

Yeah, guess this is now my best option.

the smart option would have been to buy a burner phone for £10. especially if you cannot afford whatever phone you did buy and had to stick it on a credit card and now cannot afford to pay off the credit card when it's due.

when my wife smashed her phone and was away getting repaired she just toughed it out for a week. when they got back to us it was to say they couldn't repair it and were willing to give us the cash to buy a brand new one for £200 from CPW. I bought the phone originally from elsewhere for £160 so it was a result after adding the £25 excess on i was still in profit.

I then used the cash to buy a redmi note 5 ai dual camera 64GB 4GB RAM for £160 from aliexpress/gearbest.

i am guessing you went full out and spent like £1000 on a phone. take it as a lesson learnt and move on.

 

[Mercenary Keyboard Warrior]

I use to work in this industry and know a bit about some of this stuff

The insurance is to put you back into the same position as if it hadn't happened is really an assumption and rarely specifically listed. This is really what law seek to achieve and as insurance seems to be providing the same (but for different reasons) people confuse them. Really even like for like insurance isn't exactly the same position had the event not have happened, but its far closer than non like for like.

They did a load of testing around the cards thing. Basically a number of things were proven and assumed, some of them as follows :

People liked the card as for many it sped up the process. This was pre bank transfer being the default payment option of course, it was cheque mainly, so upon receipt of the card you could immediately go out and replace, where as cheque you had to pay it in, wait for clearance then go out.

Most people selected the card as the option when given a choice. As ever it costs more for multiple payment types, so it easier to standardise this for the ins co.

Fraud. It was semi proven that fraud was reduced when instead of a bunch of readies you got a card to replace items only valid for some retailers.

I forget the rest now, it was 20 years or so ago. But the key take away was that most people preferred the purchasing card type system.

 

[strumpusplunket]

the smart option would have been to buy a burner phone for £10. especially if you cannot afford whatever phone you did buy and had to stick it on a credit card and now cannot afford to pay off the credit card when it's due.

when my wife smashed her phone and was away getting repaired she just toughed it out for a week. when they got back to us it was to say they couldn't repair it and were willing to give us the cash to buy a brand new one for £200 from CPW. I bought the phone originally from elsewhere for £160 so it was a result after adding the £25 excess on i was still in profit.

I then used the cash to buy a redmi note 5 ai dual camera 64GB 4GB RAM for £160 from aliexpress/gearbest.

i am guessing you went full out and spent like £1000 on a phone. take it as a lesson learnt and move on.

Nah, you're way off there. I got a Mate 10 Pro for less than £400. Paying off the credit card isn't going to be a problem other than I'd rather not spend my own money to do it.

Thing is I contacted Swinton first, who I also have insurance with. They said just to send them the details and they'd send out a cheque. Trouble is I found out I have a £300 excess on that policy that I'd forgotten about, but still I got the idea that my other insurance would work the same way. Sadly not.

Swinton are class when it comes to claims, it seems. When we have water damage to the house they were really fast and efficient, and took over all the management of the repairs for us. It was really hassle-free. Also they seem very cool with gadget claims - just send us these few documents and we'll post a cheque. Cedar Tree wanted several more documents (some not easy to get gold of) and were not as efficient.

I use to work in this industry and know a bit about some of this stuff

The insurance is to put you back into the same position as if it hadn't happened is really an assumption and rarely specifically listed. This is really what law seek to achieve and as insurance seems to be providing the same (but for different reasons) people confuse them. Really even like for like insurance isn't exactly the same position had the event not have happened, but its far closer than non like for like.

They did a load of testing around the cards thing. Basically a number of things were proven and assumed, some of them as follows :

People liked the card as for many it sped up the process. This was pre bank transfer being the default payment option of course, it was cheque mainly, so upon receipt of the card you could immediately go out and replace, where as cheque you had to pay it in, wait for clearance then go out.

Most people selected the card as the option when given a choice. As ever it costs more for multiple payment types, so it easier to standardise this for the ins co.

Fraud. It was semi proven that fraud was reduced when instead of a bunch of readies you got a card to replace items only valid for some retailers.

I forget the rest now, it was 20 years or so ago. But the key take away was that most people preferred the purchasing card type system.

Well, I'd have preferred cash, but I have the vouchers now.

What had made this whole situation better is that it seems I've got £100 more in vouchers than I was expecting. So not too disappointing after all!

 

[HungryHippos]

Amazon vouchers aren't too far off being worth the same in cash. You'll probably lose 10% at most if you sold them all.

10% may even be overstating it. Possibly closer to 5%.

 

[strumpusplunket]

Amazon vouchers aren't too far off being worth the same in cash. You'll probably lose 10% at most if you sold them all.

10% may even be overstating it. Possibly closer to 5%.

Yeah, that's a good consolation. Plus of course, being Amazon vouchers I'd almost certainly use them myself at some point over the coming year or two.

It does all come in one big voucher, though, so it would depend on someone wanting to make a large Amazon purchase.

Guessing the MM here would likely be the best place to sell if I decide to?

 

[HungryHippos]

Yes you can do that, someone making a bigger purchase may take them off your hands.

Guess it depends how much it's for though, I'd prefer to have received a few smaller ones were I you as you could then use some, sell some.

 

[Phantom Shadow]

It does all come in one big voucher, though, so it would depend on someone wanting to make a large Amazon purchase.

You wouldn't have to use it all in one go though, just add to your amazon account and slowly use it over the next few years.