Category Archives: insurance

Past mistakes

Controversy of the week: what to do about the legacy of cosmetic surgery in which a key component is (retrospectively) deemed defective?  Should the offending breast implants be removed, replaced, or left alone?  Who should pay?  Different countries have reacted differently, and every reaction is sure to have outraged someone.

I find it slightly bizarre that this should be seen as a matter for governments.  Surely it should be for medical professionals to deal with: is there a medical issue, and if so what are the pros and cons of each option?  The role of politicians might be to consider how it happened in the first place and whether there are lessons to be learned for the regulatory system.  But I hesitate to say that, because the most likely outcome of politicians reviewing a hot topic like this is to make things worse.

I have one suggestion for them.  The question of who pays if corrective surgery is required can and should be dealt with by requiring all cosmetic surgery to carry insurance against the full cost of such an event arising in the lifetime of the patient.  An insurer, having its own money at stake, is better-motivated than a regulator to scrutinise the actual risks of any particular procedure.  It is also better-equipped to do so, with the budget for expert scrutiny being determined by the actual risk being taken on, rather than competing with many unrelated tasks for a fixed, politically-determined pot.

Oh, and I wonder if this’ll lead to a whole raft of similar cases being unearthed as journalists seek out new stories?

Insewerants

March is the time of year my home insurance comes up for renewal.  This year I took the time to shop around using online price comparisons, and found a far better deal than my existing insurer.  No great surprise there.

I gave it a while to mull over, and read the new insurer’s cover in detail.  Compared to the old one it’s actually rather more comprehensive.  For just over half the price!  OK, let’s order this one, and cancel the old one.

The renewal notice from the old one has a freephone line.  So I ‘phoned it, and after a couple of menus I was through to a customer service person.  He was of course keen to quote me the best deal (and was perfectly pleasant about it) so I agreed to let him give me a quote.  When he mentioned a very low excess, my reaction was one of Good Lord!  In that case I should’ve claimed when my friend’s dog ripped my coat! Before that conversation it hadn’t even crossed my mind to claim on insurance for that.

His reaction was instant and clearly automatic: I should have been able to claim against my friend’s insurance.  Yep, it’s all about shifting liability.  My reaction was a slightly-horrified What?  It’s hardly something to go around suing my friends over!

Two different mindsets, and the insurers win because people don’t claim.  But what if I got over my instinctive revulsion at the idea of suing my friend?  Just treated it as a business transaction: no hard feelings, no guilt?  That’s what I should be doing in my insurer’s world!  They’re pushing us into being cold, calculating, and ruthless.  Discounting such nebulous irrelevancies as friendship.

From where I sit, that’s a big hurdle to making a claim.  But if I were to cross that hurdle, surely the logical next step is on to fraud, as in let’s just lump in existing damage or wear-and-tear with what the dog did[1].  That step is surely much smaller than the hurdle I’ve crossed to claim against my friend.  And from there it’s small steps to much bigger fraud.

It seems a logical conclusion that insurers have only themselves to blame when they suffer large scale fraud, such as staged car accidents.  They’ve trained us to think that way!

Oh, and yes I did switch my home insurance.  As well as my stuff (which I’m unlikely to claim for unless I suffer catastrophic loss like a big fire or burglary), it explicitly covers things like tenant liability if I were to burn down my landlord’s property, and of course the usual third-party things if I were held liable for something while out walking or cycling.

[1] there wasn’t any with the coat in question, which was brand new just a week earlier. But that’s not the point!