Budget Direct Refuse to Reinsure - Due To Claims History

pencilhead on 28/01/2020 - 16:58
Last edited 28/01/2020 - 17:08 by 1 other user

Hi,
I've been with Budget Direct for over 5 years for House and Contents as well as for 2 cars. Until recently have never made a claim.

My daughter got her L's 9 months ago. The day she did, I updated our insurance policies noting her as a driver and paying the increased premium. In Dec she had an accident, with about $3000 damage to our car. I made a claim and paid the young driver excess's of $2000.

Today, I received a letter from Budget Direct saying they will not renew the policy on our cars due to "the claims history of one or more drivers on the policy falls outside our acceptance criteria."

When I rang Budget Direct, I was told bad luck. They won't even review the decision.

Automotive Car Insurance Insurance

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Comments

    • stewy on 29/01/2020 - 13:57

      Churning won't always get you better rates.

      I've tended to have good experiences with NRMA in the past as a younger driver with performance vehicles. Infact, the renewal price has often been kept lower than the cost of a new policy…

      Likewise CGU have been good for me and house insurance. Very competitive initial new policy price and only fair increases each year.

      As for health insurance, the price I am paying BUPA for my junk policy to avoid MLS is lower than their current offers and also that of other insurer's junk policies.

      You are right about L coverage though, pretty sure NRMA atleast used to cover Learners with no age excess or listing required, as that was all based off the supervising driver.

  • Typical16-bitEnjoyer on 29/01/2020 - 08:50
    +5

    Cool. You're sorted out a new insurer.

    Now spend some money on general driving and defensive driving lessons for your child.

    At fault hitting a truck is not normal.

    • Euphemistic on 29/01/2020 - 09:18

      At fault hitting a truck is not normal.

      According to insurance companies and panel beaters and the nightly news it is entirely normal to crash, even into stationary objects that aren’t on the road.

    • Minimum chips on 30/01/2020 - 22:07
      +1

      Yeah, this is the part that actually seems interesting, surprised it's not more in focus.

      Obviously no point beating on OP for accident in past or not understanding budget direct's reaction. But how does someone do 3k of damage hitting a truck? That's not a single replacement bumper panel unless your L-plater is driving an investment AMG Merc. So was this at speed? Somehow hit side-on?

      If the car has been in an accident with structural/chassis damage maybe that's a big part of them not wanting to insure.

  • ipiok on 29/01/2020 - 08:52
    +1

    To be fair, most insurance companies will review your policy even after one claim and if they deem you to be high risk or not profitable will terminate the policy, welcome to the real world.

  • codinghelloworld on 29/01/2020 - 09:07
    +1

    I was insured with Budget Direct for 2 years, and each year pay $1300 for premium. They said they have discount for No claim for each year but it is not enough comparing the premium.

    I got quote from AAMI is much cheaper around $560, I had a talk with BD and they told me I paid a premium for better coverage and protection bla bla bla, they reduced the premium to $980, etc… At the end I chose AAMI.

    Even I did not make any claim, but I think BD not value current customer.

    • godofpizza on 29/01/2020 - 16:59

      were you driving a high risk car?

    • netjock on 29/01/2020 - 17:37
      +1

      They tried that with me. It is just all BS they offer better cover. If they did then they wouldn't be "budget" direct.

  • Drj55 on 29/01/2020 - 09:23
    +3

    I don't know why you're sad to leave. They absolutely tore you a new one with that excess!

    • macrocephalic on 29/01/2020 - 10:56

      Yeah, he probably didn't even break even after paying the higher premium and then the exorbitant excess.

  • OnAWhimTwo on 29/01/2020 - 09:27

    If you are in South Australia try RAA if not try your relevant Automobile club

    When my boys were both learners they were added to my insurance at no extra cost. we have made claims with them and not had a problem. we now insure almost everything with them.

    We switched from AAMI when we had several bad experiences. With them it appears you premium goes to paying for the lip service.

  • Muzeeb on 29/01/2020 - 09:41

    A series of complex algorithms has highlighted your policy as a risk. Bad luck unfortunately.

  • CalmLemons on 29/01/2020 - 10:01
    +1

    Just FYI the insurance companies underwriting have been all told to reduce exposure to higher risks, partly due to the increased risk of climate change causing an adverse event.

    • brendanm on 29/01/2020 - 14:43
      +3

      Can confirm, I crashed my car due to climate change last week.

    • gazzathegreat on 29/01/2020 - 19:54

      ScoMo's fault again i suppose!

    • imurgod on 30/01/2020 - 21:46
      -1

      The market is hardening so premiums in certain classes are going up.

      Insurers have been paying out a lot due to natural catastrophes of the past decade and not getting decent returns on investments.

      It's cyclical but the market has been soft for too long so don't expect prices to stop increasing for some time.

      The definition of a poor risk has broadened a lot, so it's fairly easy to become uninsurable lately.

  • RocketSwitch on 29/01/2020 - 10:08

    Insurance solved!

  • savage bargain on 29/01/2020 - 10:55
    +2

    Take it as a blessing - they aren't that much cheaper yet my brother and a few mates have had issues with Budget doing anything they can to get out of claims. (Each case was eventually resolved through the ombudsman, but who wants to do that when they need to claim?)

    Find a company that isn't going to cause you headaches if something does go wrong - there's no point getting cover that you can't claim from or need to go through months of complaints and ombudsman submissions. RAC in WA seems to have a pretty good rep and seems to be the one most people I know go through once their kids start learning to drive.

    • unwashed00 on 29/01/2020 - 13:49

      Could you share the details on claims issues?

      • savage bargain on 29/01/2020 - 16:44
        +2

        Each were quite long stories as Budget used obscure clauses, but to summarise it, they would use clauses in the PDS like intentional damage (even though they were typical accidents/drivers stuffing up kind of things) and modifications (even though it was replacing an old, broken stereo and Budget had already covered it as it was added to the cover when replaced). Once it got to the Ombudsman, it quickly was ruled in the favour of the person making the claim. But to get there, it means going through the full insurance complaints process beforehand so it was a minimum of 2 months - my brother's took a bit over 4 months after the accident to resolve as Budget delayed his case but submitting extra paperwork for consideration.

  • macrocephalic on 29/01/2020 - 10:55

    I was with Budget for home insurance for about 7 years, every year the renewal snuck up on me and I forgot to check alternatives. This year I remembered in time; I saved ~$700 by going to Suncorp. I might have saved more if I'd searched harder.

    Budget are not budget.

    • Typical16-bitEnjoyer on 29/01/2020 - 12:19
      +1

      That's called loyalty tax. You need to keep switching your Car, Home & Contents, Elec and Gas every 12 months to get the best deals. I regularly just swap between Budget/Bingle/Woolworths and take advantage of their offers.

      • gimme on 29/01/2020 - 12:48
        +3

        yup also known as the lazy tax. But hey we need that to subsidize those of us who put in the effort to switch ;)

  • afah0447 on 29/01/2020 - 11:11
    +1

    Looks like the actuaries are doing their jobs. You are now too risky and not an easy source of profit.

    Insurance company's are in it for money alone no matter what their marketing and spin departments sell.

    Welcome to Capitalism.

  • CocaKoala on 29/01/2020 - 13:09

    I feel your pain, but is there a question here that I'm missing?

  • [Deactivated] on 29/01/2020 - 13:26

    Insurance should be a service for everyone, I hate how they can cherry pick who they want to insure to maximise profits.

    • netjock on 29/01/2020 - 17:39

      Then it will be like NBN, expensive and crap.

      That said. If you aren't claiming then your renewal should be the same if not lower. It isn't like you've created any more work and your car appreciated in value.

      • [Deactivated] on 29/01/2020 - 17:55

        Do you mean depreciated? Yeah I was insured since I was on my red P's, my car has dropped in value by a good 3-4k and I've made zero claims yet my insurance keeps going up, it's bullshit.

    • imurgod on 30/01/2020 - 21:49

      All insurance is, is transfering risk off your balance sheet onto theirs.

      They, like any business, is there to make money. They are not charities.

      • [Deactivated] on 30/01/2020 - 22:36

        All they do is make a profit and when they make a huge loss, the government will just bail them out. It seems win-win for them, which should not be the case in business.

        • imurgod on 31/01/2020 - 09:58

          What? Massively incorrect! When has the government bailed them out?

          Are you referring to the times when there's a natural catastrophe and the government bails out the uninsured and underinsured?

          They have never bailed out the insurers, they have to pay the claims. It's the morons who don't get the right insurance or get no insurance and live in a bushfire or flood prone area that get bailed out by the govt. and I agree, it shouldn't happen.

  • dynamite on 29/01/2020 - 15:09

    I didn't have this problem when I renewed with them. The missus had a bit of an accident (at fault), and we made a claim. After the year ended, we got a renewal notice, although at a higher price. I opted not to renew and to shop around. While I was re-applying at BD just to see how much it would be, their quote still turned out to be the cheapest one. I declared that one of the other drivers on the policy had made a claim before, and the price quoted was less than the renewal price ¯\_(ツ)_/¯

  • Vote for Pedro on 29/01/2020 - 15:32

    It’s a for profit business decision. They don’t want you as a customer.

    Expect this to start happening in health insurance regardless of whether you have been paying for 30 years and only recently made one claim.

    • netjock on 29/01/2020 - 17:40

      You mean the American model?

  • eggles01 on 29/01/2020 - 15:34

    when they sent tne letter there was a history as the accident happened before they sent the letter,as far as the statement that she should have been taken the same as if you were driving,does that include you receiving the same charges and recieve the same fines as your daughter,it would have been much clearer than just explaining it as an accident,

  • fozzie on 29/01/2020 - 18:34

    What a lot of bs. Very unfair they won’t insure you, as you only claimed $1000 after the massive excess.

  • roh008 on 29/01/2020 - 21:16
    -1

    I don't understand - you made a claim for a fix that was approx $3000 but you paid $500? for your excess + an additional $2000 for the young driver excess.. You could have paid to have the car fixed and not made a claim or did that not cross your mind…

    ….oh wait, there it goes it just crossed your mind!

    • Hangryuman on 30/01/2020 - 08:56
      -1

      self-insurance is recommended for those that can afford it

      insurance is typically bought by those who can't afford the bad event.

      • newjerseydamo on 31/01/2020 - 08:54

        It has nothing to do with self-insurance.

        You can still have insurance and choose to have something fixed without claiming, especially in this instance where the excess and the damage is so close together.

        Your comment saying insurance is bought by those who can't afford the bad event is also not applicable. If they could afford the excess, they could afford to pay to repair the damages privately.

      • roh008 on 02/02/2020 - 00:16

        1) he's right you can't 'self insure' you still need basic 3rd party insurance.
        2) if the cost of repairs is the same or a little more than the excess it is usually wiser to pay for the repairs, otherwise you end up in OPs situation!

  • Hangryuman on 30/01/2020 - 08:54

    a colleague who had worked as an actuary for an insurance company told me that if you're likely to need insurance, they won't cover it. Plain and simple.

    They are in the business of maximising profits by minimising payouts. While also attracting customers with their offers.

    So the balancing act is appearing to cover you - while refusing to cover those risks that would actually lose them money.

    If another was re-insured after a claim, but this daughter was not, I'm guessing the combination of youth and an accident meant they chose to refuse to renew.

    At least they paid out the first time AFAIK - I've read many stories of US insurers notorious for distract, deny, delay, defer health insurance claims until the person dies - and then it's sweet - money in the bank !

  • diddy50 on 30/01/2020 - 12:26

    Budget Direct sucks, if you hit your own property (garage roller door, house wall or fence etc.) or another one of your cars, you're not covered.

    That was reason alone for us to not renew and go AAMI and have been treated well ever since.

    • imurgod on 30/01/2020 - 21:52

      You might want to read your PDS. AFAIK, AAMI also has some exclusions around those type of claims.

  • lltravel on 30/01/2020 - 14:27
    +1

    loL @ anyone who gets budget car insurance

    Even the name sounds dodgy

    People really need to read the PDS and not go with an insurance company that has the most ridiculous ads. Just take YOUI, BS ads with ridiculous prices

  • Saver Scott on 31/01/2020 - 07:46

    I built a house in a new estate in a nice location and contacted Budget Direct for an insurance quote and they said we can’t insure you. Obviously I asked why and was told, “I don’t know why. But we can’t.” I’ve never made an insurance claim in my life at that point and several years later, still haven’t. I was able to get quotes from other companies no problem.

    • roh008 on 02/02/2020 - 00:20

      if it's a new estate that is probably the reason, there is no 'history' so it is hard for them to assess risk. it's not as uncommon as you might think

      • Saver Scott on 02/02/2020 - 07:56

        Thanks for that. I wish they had told me why because my brain concocted all sorts of fantastic reasons why they wouldn’t insure and had me worried.

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