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all-risk insurance, An all-risk car insurance gives a protected feeling. The name of the policy says it all: every risk is covered. With certain damage cases, however, it is smart to first find out whether it is better to pay for the repair out of your own pocket. A claim with the insurance can quickly cost you much more money than the amount of the damage.
If your car is all-risk insured, you can easily have a dent in the sheet metal or a scratch on your bumper repaired. But if that damage is relatively small and your own fault, then it can turn out to be very expensive in practice.
Menno Dijcks, car insurance expert at comparison website Independer.nl, warns: “If you claim the repair of damage through your own fault from your insurance company, you will lose five damage-free years.
As a result, you fall back on the bonus-malus ladder, which determines the premium discount on your policy. A claim of a small amount of damage can have very negative consequences for the premium you pay for your all-risk insurance.”
“If your car is younger than five years old, it makes sense to take out all-risk insurance.”
Menno Dijcks, car insurance expert of Independer.nl
Even in the event of vandalism, you are the victim yourself
But also on damage caused by vandalism – for which the owner of the car himself is not at fault – the insurance company covers itself by deducting the claim from your damage-free years. After all, no counterparty is known from which the costs of damage repair can be recovered.
An example from practice: the owner of an all-risk insured youngtimer finds out one morning that an unrepentant person has tried to use his well-maintained classic as a climbing device at night. Result: a dent in the bonnet. Under the windshield wiper there is no apology note with the phone number of the perpetrator. But don’t worry, thinks the owner of the car: his ‘holy cow’ is all-risk insured, so the repair of the bonnet can be claimed from the insurance company.
The owner reports to the police and a loss adjuster estimates the repair costs at around 1000 euros. However, the phone call with the insurance company to pass on the estimated amount of damage becomes a sobering conversation.
It is certainly possible to recover the repair within the all-risk policy, but then the owner of the damaged car does fall back a number of steps on the bonus-malus ladder. And he would have to count on a total premium increase of around 4000 euros in the next five years.
The message that the employee of the insurance company on the other end of the line has for the injured owner: “It is much wiser to pay for the repair of this damage out of your own pocket.”
The Guarantee Fund also has its limitations
In the case of the above example, the owner of the youngtimer could still try to get the damage compensated through the Guarantee Fund. This fund was created to compensate victims of damage caused by others. You can turn to the Guarantee Fund if it is unknown who caused the damage, if the culprit is not insured or drives a stolen vehicle. Even if the insurance company of the other party has gone bankrupt, or if the culprit is exempt from insurance, the Guarantee Fund will process your claim for damages.
But there are some conditions attached to this claim. When the perpetrator is unknown, you must be able to demonstrate that you have done your best to trace this person, for example by looking for witnesses nearby or approaching people who may have video recordings of the incident. A police report is also mandatory.
In addition, you must take action quickly: if you submit a request for compensation more than 14 days after the date of the damage, this will no longer be processed. On the website SchadeZonderDader.nl, it can be determined on the basis of a few questions whether it is useful to submit the damage to the Guarantee Fund.
The old-timers (Why you better not claim small damages with your all-risk insurance)
In the case of the practical example mentioned above, you may wonder how much sense an all-risk insurance for an older car makes. Menno Dijcks of Independer.nl: “Up to an age of about five years, it makes sense to take out an all-risk insurance on your car. After all, the car still has a relatively high daily value.
In the event of damage caused by his own fault, it is up to the insured to consider whether the claim for the repair costs is in proportion to the deduction from the premium discount. This discount can be up to 80 percent if you have built up many damage-free years.”
Dijcks continues: “If you get the maximum discount and fall back five claim-free years, this has relatively little effect on the monthly insurance premium. But for every insured person, this situation is different. Unless it is an old-timer whose value has been determined by a recognized appraiser, it actually makes no sense to insure an older car all-risk.”
Why you better not claim small damages with your all-risk insurance
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