Archive for June, 2013

Your Data is a Commodity – Your Privacy is not

Posted by 28 June, 2013 (0) Comment

This article is about car insurance, not that I can help with your car. It’s to do with the commoditisation of car insurance because of the thirst for our data, why insurance companies are slowly waking up to it’s pitfalls and 2 things you can do about it whilst they slumber.

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Car Insurance Crackdown

 

You may have noticed that there has been a significant increase in the number of arrests of people involved in staging fake car accident over the last 6 months.  Behind the scenes, this is because the government said it would crack down on whiplash claims. Most people thought this meant individuals making out they were hurt following minor shunts would find it more difficult to get compensation. In fact, the government have also put pressure on insurance companies to do something about the cartels who were taking money out of your pocket.

Organised criminals have had an easy ride with this money making venture over the past few years, because insurance companies turn a blind eye to these ficticious claims because they simply recovered most of their costs from the car insurance buying public.

 

Cheaper premiums come at a price

 

Insurance companies don’t make much profit selling car insurance, some make no profit at all. They do make money from different types of referral fees. Some referral fees are from solicitors who pay for leads for personal injury claims. Others are car hire companies who charge more to hire a car to someone who’s vehicle is damaged in an accident, than they would if you or I if were to hire.  The third, usually secret referral fees, are paid to those that sell or aggregate car insurance policy data. Yes your date of birth, address, your other personal, protected information.

I have used the aggregators myself, because it is a great way to find an appropriate provider. However, it never ceases to amaze me, the level of information people are prepared to disclose, to shave £10 off their annual car insurance premium. Very few people realise that the direct marketing they receive is highly targeted, and would probably reduce if they spent less time giving their personal information to the internet. All they need do is uncheck the boxes about marketing material. Insurers would then have to work harder at reducing fake claims to make money.

Round about gangs rounded up

 

It will take the authorities a while to round up the highly organised car crash syndicates that have been milking insurance companies for years. I mention roundabouts, because that is a favourite for these gangs. Insurance companies took their eye off the ball. When they analyse trends in their data, they realised that ridiculous amounts of accidents have happened at the same junctions. When they look into it deeper, with the help of the authorities and CCTV, they were astonished to find that there have been zero accidents at some of the said roundabouts or junctions.

Follow the money is the usual mantra, because individuals receiving the settlements are obviously tied into the scam in some shape or form. However, with organised crime being behind these scams those receiving the payments do not exist or are the victims of Identity Theft – their ID’s have also been fraudulently claiming benefit, living in a flat with heaven knows how many people, the story goes on.

When insurance companies are not losing money they may fail to analyse trends. This is not the first time that this scenario has played itself out. In the 1990s car thefts were a huge problem, leading to some “hot hatches” becoming virtually uninsurable, because they were so easy to break into. The car industry had no motivation to improve its security because they charged their clients to repair vehicles and install the new stereos. The insurance companies charged those suffering thefts increased premiums, and car insurance premiums across the UK rocketed.  It was only when the public made a racket that the government stepped in and ordered the car, and insurance, industries to do something about it. We now have largely plastic stereos embedded in cars with fantastic security features. The newest technology allows you to pay according to how safely you drive. Now that is progress.

Wrap Up: Some gangs are found with 1,000’s of fake ID’s and crossed referred them to create accidents and benefit claims. Insurers can pool their resources and cut this out and we can help ourselves by ticking the right boxes.

Top Tip: It will take some years for the dodgy claims to subside and premiums to reduce. Meanwhile the only sure way to reduce car insurance premiums is to increase the excess, here’s a link to a nifty tool that allows you to do just that. We cannot help with car insurance, because resolving claims is such a nightmare. So we decided to take advantage of this tool and provide you all with a solution. We do not ask for your inside leg measurement before offering you a quotation.

Categories : Accountants Insurance,After The Event,All Risks Insurance,Building Contractor,Business Insurance,Company Insurance,Contractors Insurance,Customer Service,General Requirements,Health & Safety,Legal expenses insurance,Liability Insurance,Litigation expenses insurance,Personal Insurance,Solicitors indemnity,Solicitors insurance,Trade,Uncategorized Tags : , , , , , ,

Landlords lord it over leases

Posted by 14 June, 2013 (0) Comment

Small print, in leases, that is rarely read, can lead to insurance problems, uninsured losses of occupants and confusion over who pays for what when thieves target leased or serviced offices.

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The price of fashion

 

Mark calls me and tells me that his office has been broken into overnight. Indeed, all six offices in his building have been turned over.  The office is in a fashionable part of London, and somehow they managed to bypass the security on the front door, unpick the locks on the first floor security door and then pull each of the glass doors to each office, off their hinges. Mark wasn’t initially concerned about the items stolen because it was only a redundant laptop, and a safe full of paperwork, rather than money.  He did feel sorry for the five other companies on his floor, because the laptops that were stolen from them were new, contained sensitive data, designs, plans, and other important information… not all of which had been backed up.

How the thieves got past both doors seemed a bit of a mystery, the CCTV was in operation and the footage would show who exactly the thieves were.  However, it transpired that the main door lock was not working properly, and the heavy security door on the first floor had not been locked by the last person to leave. No one wanted to admit it was them who had left last, and in such circumstances it’s never easy to determine who that might have been.  The CCTV could identify the culprit, albeit not the culprits that everyone initially thought the CCTV would be used to identify.

 

Landlord negligence is uninsured?

 

The broken door to the street had been reported to the landlord, so they had been negligent in not arranging for an immediate repair. This certainly would have prevented the problem,  but how did the thieves knew that this door was not working. It’s not sinister, they are purely opportunists. It’s daft that both security doors were left unlocked at the same time but it happens because we’re human and forget things. Sometimes these mysteries are never unravelled. Mark would have been gutted if it had affected his cover.

I had already visited Mark’s premises, to ensure that the security that he did have control over was accepted by his insurance company. When we first explored Mark’s prospective requirements, we had to negotiate with insurance companies because some of their humans had forgotten that a trendy office should have a glass sliding door. If you ever look at insurance company requirements you’ll find they’re quite ambiguous when an unusual feature is in existence. This often crops up with serviced offices, because landlords of these places do not spend a lot of money on the security because they assume nobody will get past the desk security.

They don’t realise that it’s not unusual for someone to “stowaway” in a premises and rifle through unattended offices overnight, before pushing an emergency exit door open and carting off their booty. Thieves love serviced offices because landlords are never going to warn proposed clients of this weakness when they are trying to sell them their office space.

 

Who is going to pay?

 

You would think that the landlord would accept responsibility, having not fixed the door. However, in my experience, they simply refer you to the clause in the lease, which confirms that they are not responsible for a loss of this type. The way leases are worded, it could be argued that they are not responsible for anything, but I am not a lawyer – I only wish I were that clever. The excess on office insurance is usually quite low – around the same amount as an hour of a solicitor’s time. It makes sense to pay a solicitor to review a lease or serviced office agreement. They will advise you on exactly what the landlord not taking responsibly for, giving you the opportunity to cover yourself for the balance

So, how do you enforce your rights against a negligent landlord? You could, in theory, stop paying your rent – to balance things out. However, you will find that an established legal process will kick in when you don’t pay your rent, because clauses in the lease normally dictate that there is no relation between the two issues. You might have to sue them, or at least threaten to. And if you are going to do that, you will need some sort of legal backing. This is widely available; indeed, a lot of people have this form of protection, yet because their cover has not been explained to them in detail they would not even know.

Wrap up: When you are in an office or any premises where you do not control the security, it makes sense to ensure that your premises are well protected. If undesirables do visit, and find that your security is stronger than everyone else’s they will, at least, leave you until last because they are usually in a hurry. It takes seconds to prize a door open and rifle through an office – thieves are usually after things they can sell for cash, don’t you just love the modern phenomenon of “pop-up” pawn shops. The fact these thieves took the safe indicates that they had a getaway vehicle, yet this is not always the case. The security to your premises is your responsibility. Don’t expect a landlord to be too concerned about it.

Top Tip: Mark discovered that the sensitive information in the safe meant that he did actually have to notify people if their privacy was likely to be breached. This is a requirement of the data protection commissioner, and applies to anyone who collects certain types of sensitive data. Fortunately, Mark and I had discussed this at the outset and the cost of doing this was not prohibitive.

 

Categories : Accountants Insurance,After The Event,All Risks Insurance,Building Contractor,Business Insurance,Company Insurance,Contractors Insurance,Customer Service,General Requirements,Health & Safety,Legal expenses insurance,Liability Insurance,Litigation expenses insurance,Personal Insurance,Solicitors indemnity,Solicitors insurance,Trade,Uncategorized Tags : , , , , , , , , , ,