can the insurance co refused to lower the insured value of the car?

[paddypower]

I've been insuring with Viriyai for a number of years. Never submitted a claim, i pay for repairs, eg in 2021, when a motor bike hit the car. I bought my 2014 Ford Escape for 550,000 baht, in 2017. The company has the insured value at 400,000 baht, for 2020, 2021 and 2022;. This valuation is now  overvalued, according to the market (and the Red book, if I could access it). Ins. is Comp. type 1. Premium was 16,900 in 2020 and 14,450 in 2021. This year's renewal will cost 14,250. My question is - can I insist that they reduce the value of the car to say 300,000 baht?. The agent simply cannot understand why I want to do that. He says Viriyai has given me all the discounts they can give (whatever that means). Surely I can insure the car for what it is worth?

[Etaoin Shrdlu]

While reducing the insured value from 400,000 to 300,000 reduces the amount the insurer would need to pay out for a total loss, it does not reduce the amount they would have to pay in the event that an accident is not a total loss, a much more likely scenario. 

 

In a totally free insurance market, an insurer would be able to charge a different (higher) rate against the lower value, but in Thailand, insurers are required to file their rates with the Office of the Insurance Commissioner and are not allowed to deviate from those rates. Even if they could do so, a different rate that still generated sufficient premiums to cover partial losses, but was reduced to reflect the lower total-loss amount, would likely not generate a significant reduction. In any event, regulations don't allow for this so you're probably going to be stuck with a valuation that the insurer believes will generate sufficient premium for the risk.

 

Your best option is to shop around to try to find an insurer that will charge a premium that is acceptable to you using either your lower insured value or their higher one. You may also wish to ask about deductible options. That may work better.

 

Find a good insurance broker and tell them what your premium target is. They may be able to find an insurer that can accommodate.

[paddypower]

On 3/31/2022 at 4:41 PM, Etaoin Shrdlu said:

While reducing the insured value from 400,000 to 300,000 reduces the amount the insurer would need to pay out for a total loss, it does not reduce the amount they would have to pay in the event that an accident is not a total loss, a much more likely scenario. 

 

In a totally free insurance market, an insurer would be able to charge a different (higher) rate against the lower value, but in Thailand, insurers are required to file their rates with the Office of the Insurance Commissioner and are not allowed to deviate from those rates. Even if they could do so, a different rate that still generated sufficient premiums to cover partial losses, but was reduced to reflect the lower total-loss amount, would likely not generate a significant reduction. In any event, regulations don't allow for this so you're probably going to be stuck with a valuation that the insurer believes will generate sufficient premium for the risk.

 

Your best option is to shop around to try to find an insurer that will charge a premium that is acceptable to you using either your lower insured value or their higher one. You may also wish to ask about deductible options. That may work better.

 

Find a good insurance broker and tell them what your premium target is. They may be able to find an insurer that can accommodate.

Thanks for the details of how the 'system' works. I know my thinking was rather simplistic. Part of my questing the new premium is that my agent is a body shop. The owner recommended that i not claim for damages caused by a 3rd party (who rode off before I could identify his licence plate). so I didn't, assuming I would get a no claim discount. That has not happened. My opinion is, the 'agent' is not looking out for my interests.

[Etaoin Shrdlu]

47 minutes ago, paddypower said:

Thanks for the details of how the 'system' works. I know my thinking was rather simplistic. Part of my questing the new premium is that my agent is a body shop. The owner recommended that i not claim for damages caused by a 3rd party (who rode off before I could identify his licence plate). so I didn't, assuming I would get a no claim discount. That has not happened. My opinion is, the 'agent' is not looking out for my interests.

Sorry you had a bad experience.

 

I think it is important to remember that an insurance agent is the legal representative of the insurance company and their first priority and obligation will be to look after the interest of their principal, the insurer.

 

An independent insurance broker under the law of agency is the legal agent of their client, not the insurer. A good, independent broker is, in my opinion, usually a much better source of advice and support than an agent of an insurance company. 

 

Good luck!

[HampiK]

Are you sure, the value of your car is not lowered?

As your premiums were lower every year. Check your new documents again very good, as normaly the Thai Insurance company reduce the amount automatically every year... 

[paddypower]

3 hours ago, Etaoin Shrdlu said:

Sorry you had a bad experience.

 

I think it is important to remember that an insurance agent is the legal representative of the insurance company and their first priority and obligation will be to look after the interest of their principal, the insurer.

 

An independent insurance broker under the law of agency is the legal agent of their client, not the insurer. A good, independent broker is, in my opinion, usually a much better source of advice and support than an agent of an insurance company. 

 

Good luck!

agree,, absolutely.  All my other insurance is with an independent broker, from back when I lived on Phuket.  and there has never been a conflict between my interests and those of the ins company. It just slipped my mind, in this instance, when I moved to NST, I changed Ins cos. for my car.