ADVICE: 4X4 INSURANCE
NOW IS A GOOD TIME TO REVIEW YOUR VEHICLE INSURANCE AND ENSURE IT IS THE RIGHT ONE FOR YOU.
WHILE Australia is showing the world how to deal with C19, we’re not quite out of the woods yet. It’s looking much better for taking small trips and catching up with friends and family, though, which is great. However, the economic impact will be felt for a while. So, regardless of who you are insured with, here are some tips on things to consider before you take care of the annual insurance shop-around and renewal. We’ve identified five ways you can help manage your insurance premium, and we’ve also detailed a few things you need to consider to ensure it is adequate for your requirements, because, after all, it’s a balancing act.
1. CONSIDER WHAT ‘EXTRAS’ YOU NEED, RIGHT NOW.
a. Windscreen options? b. Hire-car after accident? c. Roadside assistance?
WITH most of us using our pride and joy a little less right now, it might be worth asking yourself if you need all the extras on your policy. Remember, though, while you’ll save money, removing each of these will likely reduce the cover available in the event you need to claim.
2. DOES ANYONE YOUNG DRIVE YOUR VEHICLE?
DRIVING experience is a big factor in calculating premiums. Generally, the younger a driver the higher the risk and the associated premium. Insurers being the clever people they are have developed an ‘age restriction’ to help manage premiums. This means that if someone younger doesn’t drive your car, you can save premium by excluding cover for anyone under a certain age. For most insurers, 25 seems to be the magic age, but some offer graduated scales with greater savings available based on excluding from a higher age threshold.
3. ARE YOU MAKING THE MOST OF THE DISCOUNTS AVAILABLE?
a. Club membership? b. Multi-policy discounts? c. Driver/towing training discounts?
THERE are a multitude of discounts available through insurers. There is the multi-policy discount, which is a discount for having multiple policies with one insurer. Beware that some apply it differently. Some require two or more policies, others three or more, some apply the discount to all items you insure with them, and others only apply the discount to subsequent policies (i.e. only a discount on additional policies, not the first one).
Some insurers will offer a discount for driver training, which can be quite generous (Club 4X4 offers up to 20 per cent off for off-road driver training on your 4x4 policy and up to 10 per cent off your trailer policy, if you’ve done towing training through a Registered Training Organisation). If you have completed this kind of training, you could be eligible for a significant discount.
Other insurers offer discounts for being a member of an organisation. It could be through your work, or even because you are a member of a 4WD club. It is worth asking any potential insurer about this because it could be another five per cent or so, and there isn’t really much you need to do.
4. WHAT EXCESS ARE YOU PREPARED TO PAY?
TAKING a higher excess is another way to relieve premium pressure. It means you have more to pay upfront in the event you need to claim, but it can be a way to reduce your premium
if you really need to. Upping your excess during these times where vehicles may not be getting used as much, if at all, can be a great way to manage your premium until the dust settles (sorry, bad pun)!
5. CAN YOU PAY ANNUALLY RATHER THAN BY THE MONTH?
THIS is a really simple way to save. Many insurance companies charge you more to pay monthly rather than annually, because, believe it or not, there is a difference in claims incidence between these groups. If you can find the cash to pay up front, you could save somewhere between five and 15 per cent over the year. Again, another thing to consider!
BEWARE THE PITFALLS
WHILE the above can help provide some relief to your hip pocket, there are some really important things to ask yourself before you make any changes, to ensure you make an informed decision here.
WHAT IS IMPORTANT TO YOU?
AS consumers we’ve been conditioned to care about price alone, but for most of us price isn’t really the most important thing in the equation; value is. While there is the old saying ‘you get what you pay for’, it is important that you don’t overpay either. Before you make any decision, you need to consider what value represents to you.
DOES YOUR SUM INSURED REFLECT WHAT YOUR 4WD AND EVERYTHING ON IT WOULD COST TO REPLACE, IF IT WAS A TOTAL LOSS OR STOLEN?
THIS is making sure that you are adequately insured to replace your 4x4 if you woke up and found it had been stolen – this point matters regardless of your choice of insurer. It is very easy to underestimate what your 4x4 would really cost to replace, so ensure you know what this value is and that you review the quote with the sum insured and that value in mind. Club 4X4 has a handy calculator on its website which can help you with this, and sites like Redbook are also handy tools.
DOES YOUR POLICY COVER YOUR MODS AND ACCESSORIES?
THIS might seem like a repeat of #2, but bear with us. The question here is, does your policy cover all of your mods and accessories? Most insurers will cover some of your accessories to a point (bullbar/roof rack, etc.), but a lot of them will not cover ‘modifications’. So if you’ve added a catch can, remapped the ECU, changed the suspension set-up, or done anything to the driveline, then you’ve ‘modified’ or performance-enhanced it, which may not be covered. It is important to know an insurer’s position on this so you don’t get surprised when you need to claim, and know what risk you are carrying personally if you choose to insure with a company that won’t cover all of the mods and accessories.
DO YOU HAVE CHOICE OF REPAIRER IF YOU NEED TO CLAIM?
ONE way insurers manage premiums is to keep claim costs down. The challenge with a 4WD though is it can be more complex to repair than a standard vehicle. You might be able to find cheaper insurance, but the cost might be that you are forced to use the insurer’s repairer. This could translate to re-work and inconvenience, not to mention frustration.
Many of us will have a mate or someone trusted that has worked on our fourbies, and getting to choose who works on your vehicle might well be worth paying a little more for up front. For others, who completes repairs on your 4x4 may not matter at all, but it is prudent to know this now rather than at claim time.