Insurance confusion - new for old

[Keith-i]

I have just had my renewal documents through from Pantaenius. I've stuck with them as they've always seemed to have a good reputation in the event of a claim and the premium doesn't rise for the duration of the ongoing policy. This year they have introduced some amendments one of which is a removal of the 'new for old' aspect. There is now a 30% deduction for wear/age on anything (other than the hull) over 10 years old. This includes tenders engines etc.

Now I have always insured the vessel for its second hand value and not really given any thought to a claim other than expecting payment up to the insured value in the event of damage/loss. However, if they are now going to reduce any claim by 30% what value should I insure for? The value of a brand new vessel with all equipment? Otherwise, in effect, the most I would ever get is 70% of the second hand value on everything but the hull itself.

 

[jrudge]

Have you asked them?

Changing insured values is a bit of a mine field and should you have a claim an email from them setting out the position will be of more worth than forum comments.

 

[Tranona]

The insured value is only relevant in the event of a total loss. For replacement of damaged items the 30% reduction applies to those items only. So if a replacement rig (on a sailboat) was £10k, the insurer would only pay £7k of the claim.

 

[BruceK]

Having just gone through something similar, I can understand the reduction. I've just knocked out a gearbox and 2 sets of duo props. Considering their age to replace with new would be a bit unfair and invite misuse. I replaced the lot as if it was my own money and sent the bill to the insurance company. They were happy to pay out for warranteed refurbed gearbox and refurbished props with labour, lift out etc. Can't see anything wrong with that.

 

[jfm]

As Tranona and Bruce say, you are misunderstanding the policy a bit Keith. The 30% deduction is from the price of the new item that replaces the 10 year old item. In all the circumstances, and the law, this isn't a bad choice on Pantaenius's part, imho

I don't like their new policy for other reasons, and didn't renew with them when it came out.

 

[Keith-i]

Thank you for your input gents. I will admit to not having read the full policy when I made my post; so it was perhaps a little flippant. Overall, I think a 30% reduction for a 10 year old item is very fair, but of course I'm hoping never to put it to the test. I have asked them what the premium increase is to maintain the new for old cover.