The small-print villains: Insurers risk losing what little trust people have left in them for good, says VICTORIA BISCHOFF
Some firms have really gone above and beyond for their customers over the course of the Covid crisis. It’s a shame the same cannot be said for many insurers.
We buy insurance in good faith that we will be financially protected should plans go wrong for reasons outside of our control.
But insurers sell these policies to make money, and lengthy small print packed with exclusions is how they weigh the odds in their favour — the house always wins.
Small print exclusions: We buy insurance in good faith that we will be protected should plans go wrong for reasons outside of our control. But insurers sell these policies to make money
Take Axa’s treatment of its customers David Buik and his wife Penny from Fulham, South-West London.
The couple had paid for a family holiday to the South of France to celebrate Penny’s 70th birthday in May.
The pandemic struck, and suddenly they could not travel. They were happy to support the airline by accepting a voucher to use at a later date. But the villa owner went to ground and wouldn’t respond to their calls.
So they made a claim on their annual travel insurance policy for the £5,580 cost. Yet Axa refused to cover the full claim because the couple’s children and grandchildren were also staying in the villa – despite David and his wife footing the full bill as a treat.
The insurer claimed that its policy only covers the people named on it, and not situations where customers have paid for another person’s travel or accommodation costs.
That’s a rather important exclusion for the thousands of families who treat loved ones to holidays every year. Where is it explained? On page 33 of the policy small print. There are 61 in total.
Experts say that this type of clause is usually aimed at customers who pay for a group of friends to go away and expect to be reimbursed.
In fact, when data analysts Defaqto scoured the policies of 20 other major travel insurers, they couldn’t find anything similar to Axa’s exclusion.
And it’s not as if the other guests can claim on their own cover, because they are not out of pocket – it would be tantamount to fraud. Yet that doesn’t bother Axa, and the family remains more than £4,000 out of pocket.
But then this is the same insurer that tried to wriggle its way out of refunding a couple for their cancelled honeymoon, as our letters editor Tony Hazell exposed two weeks ago.
As James Daley, of Fairer Finance, puts it: ‘This is a classic example of insurers living in a theoretical universe.’
If firms don’t start treating their customers fairly and stop relying on small print to pass the buck or deny a claim, they are in real danger of losing what little trust people have left in the sector for good.
A cold shoulder
Last week I asked you to send in tales of how conniving cold callers have tried to con you – and my inbox is overflowing.
From posing as BT engineers who say your broadband is about to be cut off, to claiming there is a warrant out for your arrest over an unpaid tax bill, there is no low these crooks won’t sink to.
Fortunately, Money Mail reader David has a great tip for sending these monsters running for the hills.
He says: ‘If there is a real person on the other end of the line, and it’s an obvious scam call, I blow a very high-pitched whistle down the phone. It is very satisfying.’
If you have your own tactic for scaring off fraudsters, I’d love to hear from you. Write to me at the email address below.
A big thank you to the Co-op for making my grandparents’ day.
Both are shielding, so my family back home pick up most of their groceries. But each morning my grandad pops down to the local Co-op to stretch his legs and pick up a newspaper.
Last week the manager – who now knows him rather well – presented him with a Christmas card and a delicious box of mince pies.
Hearing the delight in my grandad’s voice gave me a much-needed boost and was a good reminder that it really is the little things that make a difference when everything seems so miserable.
I know Christmas will be very different for most of us this year. But on behalf of the whole Money Mail team, we send our warmest wishes to you all.