The Westerly Owners' Association - Insurance Scheme
Avoiding problems with Insurance Claims
by Joe Field, Consultant with Navigators and General
We often get asked to comment on, and see comments in the press relating to, insurance companies' attitude to paying (or not paying) claims and where grey areas or confusion over terminology may be misunderstood as an effort to avoid paying claims altogether!
Firstly it’s important to clarify in its most simple terms what your boat insurance with Navigators & General is intended to provide. Basically, it is a safety net against unforeseen fortuitous events, and genuine accidents that could not be predicted, or reasonably prevented. For that peace of mind you pay a relatively small premium (compared to the sum insured) to us, and we effectively manage your premiums in order to meet claims of the unlucky few and run the business.
Being able to meet the costs of claims, balanced with our desire to keep premiums stable, is all down to our underwriting expertise, and the size and diversity of our book of business. Another factor, which is unique to the Westerly Owners’ Association insurance scheme is the claims experience of all members within the scheme, which is large enough to enable us to factor into the exclusive rates members pay and claims service you receive.
Because Navigators & General is such a large and well established company with over 80 years underwriting expertise, all policy holders will have benefited from relatively stable premiums during their association with N&G, and because the WOA scheme performs so well, members benefit from substantially discounted premiums.
Some people say that all insurers look for ways to avoid paying claims. This is one of life’s great misconceptions and is simply not true. If a company has priced a risk correctly, has the capacity to pay the claim, and the claim is covered by the policy, it is in the insurers interests to settle the claim as quickly and efficiently as possible. Having worked closely with the claims team at Navigators & General I know that to be fact. The claims team at N&G has an average of 12 years experience each, and has undertaken a number of new initiatives to improve the speed and quality of service which has helped halve the average time taken to settle a claim.
One of the most common exclusions in insurance policies related to wear and tear, gradual breakdown....or similar descriptions thereof. This is because unlike motor vehicles or properties, where there are rules and regulations to ensure they are maintained to a certain standard, or to oversee major alterations or works, there are extremely limited requirements for coastal vessels to be maintained to certain standards. Combine this with the relatively harsh marine environment and it is pretty clear that owners who do not maintain their vessels properly are likely to see their craft deteriorate to the point where they experience gear failure.
This is widely regarded as an eventuality and something Navigators & General believes prudent owners, who maintain their vessels well, should not be affected by in terms of claims being paid from the communal pool. Hence the exclusions previously mentioned and the reason we make it a condition of the policy that the vessel is kept in a seaworthy condition.
Owner negligence (other than recklessness) and latent defects are events that cannot be foreseen, and as such the consequential damage should be covered (both of these are specified perils in the policy). Whether a claim is a result of wear and tear (that should have been spotted and prevented by the owner), or a latent defect will in most cases be determined by the marine surveyor appointed by the insurance company. Navigators & General always try to take a fair attitude towards what is reasonable in terms of inspections and maintenance.
For that reason our policy does not contain an age limit for rigging to be replaced by, but we would expect members to be sensible and renew rigging if it shows signs of wear, or if advised to do so by a surveyor, yard or rigger. We respect that you are experienced boat owners and that Westerlys are well-engineered craft, but as a result of not being limited by strict age limits it is important to understand that if a surveyor advises that a claim occurred due to neglect and lack of maintenance to a boat we will probably decline it.
How far it is reasonable for members to go to in order to check their vessel over as part of routine maintenance is unfortunately always going to be open to interpretation and may vary by insurance company. Navigators & General consider a thorough visual inspection of their vessel and her gear to be reasonable including a rig inspection, either stepped or whilst down, annually. Taking the boat apart to expose normally hidden parts would be considered unreasonable and should a failure occur in such a place that would not have been obvious to the owners we would always try and assist with the claim, including costs to identify the cause of the failure and the consequential damage. The defective part would be excluded.
Probably the best, and most re-assuring, way to establish what attitude an insurance company has towards claims is to ask other boat owners or yards for their experiences with that company. Recommendation and repeat business is an extremely important source of new business, and any company that recognises that will generally look after their customers at all stages. As over 1,000 members of the Westerly Owners’ Association are insured with Navigators & General, and less that 5% a year do not renew cover, we hope the response you get will be favourable.
By insuring through the Westerly Owners’ Association scheme you will be benefiting from the overall performance of the scheme, and helping fellow members at the same time. So if you are not already part of the scheme please give us a call at renewal or submit an application.