Cyclesure issues

[Captain Fastbastard Mayhem]

Just a last addition however, when going through a broker they neglected to mention the old for new bit and wanted to insure my bike for what I paid for it second hand.

Luckily I spoke to cycle sure and read their policy doc or I would have had the same issues you are experiencing bmw1za.

that broker doesn't know what he's doing, then...

[KurTieB]

Fighting them is going to be like pissing into the wind.

The policy is very clear. There's a good reason why I've reinsured with cycle sure after a loss. They paid out according to what I was paying premiums for, no fuss whatsoever.

Piss in the wind then! Your last sentence alludes to my exact point! He should be paid out according to the premium he has been paying for, without any "fuss". His cover is for 32k and his premium is aligned to that. The fact that his bike more than doubled in price in two years isn't exactly his fault. Had his insurance brought it to his attention before the claim at around his premium increase time, then it would possibly be. I doubt whether they did this so why should he lose out?

[Bat]

Thanks guys, seems either way i am losing out. 

 

I will have to pay for the repairs, insure it at the higher replacement value and then claim for every little thing in future like some people do... Is it really worth it ???

 

I was trying to NOT BE THAT GUY !

Sorry for this frustrating loss. I think I know exactly how you feel. I have 6 bikes, one of them a single speed build up with good parts and components, (don't have half of the slips for this build). I am actually looking at putting all my bikes with Cyclesure through a broker. Had one bike with them and the rest with Myway.

 

The initial quotes I received was already confusing with suggestions of a specific bike only be insured for outside theft or loss to reduce premiums and then contacting them every time I take a deferent bike on a ride. I sometimes don't know myself which bike I am going to use the next day, now still to inform them beforehand?

 

The quotes I have received was done on the price I paid for each bike then, from 2014 to last year. I also am not interested in replacing them with an existing replacement value bike, as the one mountain bike now with the Rand Dollar is new over R130 000.00. That to me is just ridiculous and will not pay premiums for a bike of that value.

 

So I think the best solution for me to prevent my premiums to be a unreasonable each month, is to take this increased monthly amount, and be Self insured. And whatever the loss or consequences are thereafter, so be it. I have had my bikes insured for 3 years now with no claims, and I am not planning to make the insurance companies more profitable for the next 5 years from my premiums. (This is not a gripe against Cyclesure, but the insurance industries)

[Fr33rider]

Piss in the wind then! Your last sentence alludes to my exact point! He should be paid out according to the premium he has been paying for, without any "fuss". His cover is for 32k and his premium is aligned to that. The fact that his bike more than doubled in price in two years isn't exactly his fault. Had his insurance brought it to his attention before the claim at around his premium increase time, then it would possibly be. I doubt whether they did this so why should he lose out?

https://www.bikehub.co.za/index.php?/topic/139736-Do-you-know-what-you-are-covered-for-/-Cyclesure?

 

The policy document is attached in the first post of the above. It's very clear on their averaging rule if you are underinsured, it is not in any way ambiguous, hence me saying is no use going through the frustration of fighting it.

 

Just thought I'd edit to say that I am in no way affiliated to cyclesure, I'm just a customer.

[Eugene]

From my understanding of the original post. BMW was not under insured. The bike that he bought was no longer available. Only a higher spec model was available and this was significantly more expensive.

 

In which case, this should be explained to the insurance company and the quote for the repair should be based on a different brand but with similar specs

 

I know bike prices have sky rocketed, but not from R32k to R76k

[bmw1za]

From my understanding of the original post. BMW was not under insured. The bike that he bought was no longer available. Only a higher spec model was available and this was significantly more expensive.

 

In which case, this should be explained to the insurance company and the quote for the repair should be based on a different brand but with similar specs

 

I know bike prices have sky rocketed, but not from R32k to R76k

Spot on !  That was my argument..will persue it a bit more tomorrow 

[Patchelicious]

Sorry bud you were under insured. You can get worked up about it, but it's not going to help. CycleSure are within their rights here I am afraid.

 

Who was your broker, as they should have advised you on this? And adjusted premiums at renewal.

 

My Epic, bought for R40k insured for R85k

Scott RC bought for R35k insured for R75k

Colnago bought for R100k insured for R150k

 

You must insure for current replacement costs. Otherwise you are only part insuring, at that only works in very specific co-insurer arrangements in complex polices.

 

As a silly example, just to illustrate the point. If you have a 100k bike and you insure it for 50k, are you insuring the front half or the back half? It is similar to people who try and insure 1 out of 5 of their fleet of commercial vehicle. Guy has 5 identical bakkies, only takes out 1 policy because what is the chance of all 5 being in a accident at the same time. So effectively the insurer carries 5 times the risk for 1 premium, their whole business is based on getting a very precise balance between risk and premium. See why they start not liking this?

 

So if you insured a R60k bike for R30k, which half did you insure? If you insured the back half and broke the back half they would pay the 30k if you insured the back half and crashed the front half they shouldn't pay at all. Because neither you or them know which half was insured, they average it out....

[Captain Fastbastard Mayhem]

From my understanding of the original post. BMW was not under insured. The bike that he bought was no longer available. Only a higher spec model was available and this was significantly more expensive.

 

In which case, this should be explained to the insurance company and the quote for the repair should be based on a different brand but with similar specs

 

I know bike prices have sky rocketed, but not from R32k to R76k

Nope. He's underinsured. Pure and simple. Short term insurance covers you for the effect of the loss at the time of the event, not at the time of application. So its up to you to keep the policy up to date

[Fr33rider]

Get your money and leave cyclesure. Problem solved. People will learn from this thread.

You are right, they will learn... About insuring their belongings for the correct value.

[Rotiringer]

Sorry bud you were under insured. You can get worked up about it, but it's not going to help. CycleSure are within their rights here I am afraid.

Who was your broker, as they should have advised you on this? And adjusted premiums at renewal.

My Epic, bought for R40k insured for R85k

Scott RC bought for R35k insured for R75k

Colnago bought for R100k insured for R150k

You must insure for current replacement costs. Otherwise you are only part insuring, at that only works in very specific co-insurer arrangements in complex polices.

As a silly example, just to illustrate the point. If you have a 100k bike and you insure it for 50k, are you insuring the front half or the back half? It is similar to people who try and insure 1 out of 5 of their fleet of commercial vehicle. Guy has 5 identical bakkies, only takes out 1 policy because what is the chance of all 5 being in a accident at the same time. So effectively the insurer carries 5 times the risk for 1 premium, their whole business is based on getting a very precise balance between risk and premium. See why they start not liking this?

So if you insured a R60k bike for R30k, which half did you insure? If you insured the back half and broke the back half they would pay the 30k if you insured the back half and crashed the front half they shouldn't pay at all. Because neither you or them know which half was insured, they average it out....

Good man, good understanding and good layman explanation.

 

Its like a chap being bitter that he insured for R 25 per month the second hand 26er he just purchased for R5k which happened to have an XTR dérailleur. Said dérailleur breaks in accident and expects to be paid R2.5k by insurer to replace it.

[Oufy MTB (Roadie)]

i insured my old Merida for R15k with outsurance, the bike got stolen 3 years later. They paid me out for what I insured it for, R15k. They didnt even talk about replacement value. I like that arrangement.

[bmw1za]

Got a better understanding thanks guys.. as said above , will fix... then insure for 76k .. harsh realities 

 

but, bitter taste in mouth  .. insured for 32.. should be covered for 32 

[cat-i]

i insured my old Merida for R15k with outsurance, the bike got stolen 3 years later. They paid me out for what I insured it for, R15k. They didnt even talk about replacement value. I like that arrangement.

 

That was total loss, so they paid what you were insured for. REplacement value only comes into play when they need to pro-rata the claim. If they could repair it, then the repair cost would have been % of the replacement value.

[cat-i]

...He should be paid out according to the premium he has been paying for, without any "fuss". His cover is for 32k and his premium is aligned to that. ...

 

Premium is calculated (among other things) as a percentage of the total value of the bike. So the premium was aligned to total loss of 32k ... 

[cat-i]

Got a better understanding thanks guys.. as said above , will fix... then insure for 76k .. harsh realities 

 

but, bitter taste in mouth  .. insured for 32.. should be covered for 32 

 

Sorry about that.

 

no one ever wins from insurance,  

[Ryinc]

Hi Grant, sorry to hear about your accident. Perhaps just a little rationale on why the averaging rule is applied. Insurer is not trying to cheat you. Its actually to make sure equity between customers and to be fair relative to the premium you were charged.

 

Imagine a game of chance where a player "insures" the amount of money in his wallet. The game works as follows, the player rolls a dice. If it lands on 1-3, the player loses the money in their wallet to the casino. If it lands on 4 they get 25% of what is in their wallet. If it lands on 5 they get 50% of money in their wallet, if it lands on 6 they get 100% of the money in their wallet.

 

Now player A says he has R20 in his wallet. So if it lands on 1-3 he loses R20. Lands o 4, he gets R5 back, lands on 5 he gets R10 back and lands 6, he stands to get R20 back. Player B also says he has R20 in his wallet.

 

Now they both roll the dice and both roll a 4. They open player A's wallet and R20 is there. He gets (25%) R5 back. When they open player B's wallet there is actually only R10 instead of a R20 that he thought was there. Problem! What is fair payout?

Would it be fair to also pay out player B R5?

Player B says casino should payout R5 because its still less than the R10 he stood to lose? Fair?

Player A and casino says the fairest is to pay player B 50% of R5 i.e R2.50 because in reality if the dice had landed on 1-3 the casino would only have recieved R10 (i.e. 50% of what he said was in his wallet and 50% of player A)?

 

I don't know about you, but i would have to agree basing the payout on R10 actually in his wallet would be the fairest? (I.e R2.50 payout)

 

Being underinsured is like being player B.

 

Many of the events that lead to a claim on an insurance policy are below the full insured amount. It would therefore be unfair to pay two identical policyholders the same amount, for the same event, if they are insured for different amounts (and therefore pay different premiums). This is true EVEN in situations where the claimed amount is lower than the full insured amount of the underinsured person's policy.