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post #1 of 4 (permalink) Old 10-13-06, 04:32 PM Thread Starter
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Insurance help

Hey everyone!

Just need your thoughts on this scenario.

A person has purchased car from a dealer with some known existing mods (Wheels, Spoiler and exhaust mods)

The person advises his/her insurance company of the new vehicle and the existing mods and takes out a comprehensive policy.

Down the track a claim is to be made, and the insurance company advise that in fact the suspension had been lowered from standard ride height, yet this was not advised when insurance policy taken out.

The person who bought the vehicle was not aware of this, as no documentation provided by dealer at time of sale listed any mods on the vehicle, hence did not know or advise the insurance company.

In this scenario, what would the insurance company do? Would they reject or reduce the claim on the basis that the person who owns the vehicle did not advise them of this particular mod? Or would they make an exception?


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post #2 of 4 (permalink) Old 10-14-06, 02:39 PM
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Re: Insurance help

I think this would be covered by 'reasonable' measures. The owner has provided all the details they knew regarding the modifications, particularly from a dealer.
The insurance company should pay-up but perhaps pursue the dealer, if it is shown that the modifications contributed to the claim.
This is what we pay insurance for people.

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post #3 of 4 (permalink) Old 10-17-06, 12:18 PM
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Re: Insurance help

the insurance company could not reject the claim, but they would not be obligated to pay to replace undeclared aftermarket parts.
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post #4 of 4 (permalink) Old 10-22-06, 06:29 AM
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Re: Insurance help

sorry...if the policy was taken out after the onus of disclosure rules came into affect (around 1985), the insurance company does have the right to reject the claim and cancel the policy if an undisclosed modification is found during assessment after an accident...most companies won't do this if you have a good driving/insurance history and the modification was of a nature that wouldn't have caused them to reject your request for cover in the first place...

for the assessor to have discovered this modification in the above scenario, either it is deemed to be something which may have contributed to the accident, or the vehicle had been noticably lowered (in which case the purchaser should have noticed this himself)...

this is why it is really important to know your car...if you find something, even months later, that you were unaware of, let the insurance company know - most will be impressed with your honesty and do their best to help companies are all about minimising their risk, and they don't want to be paying out on claims generating form vehicles that don't fit within their policy guidelines...there are a number of insurance companies that specialise in cover for modified vehicles at very competitive rates...

remember, every year when you renew your policy, you are basically once again swearing that everything you have told them up until now is true, correct and everything they want to know!!!...hope this will help...(i was a motor vehicle claims assessor for many years, and this is a very common problem)...
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