At a meeting held for homeowners in Canterbury at the Transitional Cathedral an update was provided on insurers performance to date, including how hard it is currently to open transparent information from them. This was part of a general meeting with more than 400 people attending in relation to the question of cash settlements.

1. Managing the Insurance Dilemma:
Cash Settlements Outs
1. Progress Update
2. Indemnity
3. In Policy Settlement vs Out of Policy Cash Out
4. Land Claims
5. Why?
6. Tips

2. 1. PROGRESS
UPDATE

6. 2. INDEMNITY

7. An indemnity is an
obligation to provide
compensation for a
particular loss suffered

8. Full Replacement Indemnity vs Market Value Indemnity

9. “Betterment” is enshrined in total replacement policies:

11. 1. DAMAGE (identify loss)
2. METHOD OF
REINSTATEMENT/
SETTLEMENT (per policy)
3. PRICE (Compensation)

12. MY CLAIM RESERVE PRE EQ:

14. MY INSURERS ESTIMATE POST EQ:

17. 3. “In Policy” versus
“Out of Policy”
resolutions

18. Two practical options in policy to fulfil the
indemnity obligation:
1.Insurer managed reinstatement
2.Customer managed reinstatement
3. Cash Settlement at market value

19. Only one “Out of Policy”
option, known within the
industry as:
Cashing Out

20. Tactics used by insurers over the last
4+ years to save money:
1. Giving you the impression that the policy gives them the option of “cashing
out”, it doesn’t;
2. Electing to mange the reinstatement themselves, but delaying doing it–
forcing you to “cash out” in exhaustion;
3. Using their own experts to assess and then lowball the damage and
reinstatement method – so you are not happy and feel forced to “cash out”
4. DELAY in anyway possible (including slowing down of pass over of claims
from EQC)

21. New Tactics Emerging:
1. Trying to get customers to manage their reinstatement for fixed/capped
sums.
2. Refusing entry into insurer managed programmes.
3. Offering customers slightly more money for them to “cash out”
4. Using even more PR to give customer the impression the insurer can “cash
out”, they can’t all they can try and do is tell you that they “will get you your
life back if you cash out”, otherwise we will continue to DELAY

22. 4. EQC LAND
CLAIMS

23. 1. DAMAGE (identify loss)
2. METHOD OF
REINSTATEMENT/
SETTLEMENT (per policy)
3. PRICE (Compensation)

24. Identify Loss – Flooding Vulnerability
Thresholds x4

26. Enabling works

28. 5. WHY, WHY
WHY?

29. a) No insurer had enough reinsurance
b)Claims Reserves set early on aren’t reflective of
actual reinstatement costs
c) Loss Creep
d) Shareholders not happy
e) Will be rough couple of years for insurers – but
they are “too big to fail”

30. An Example:

31. 6. TIPS

32. Top Tips for You to Manage these Dilemmas:
1. There is plenty of money – just a question of who’s pocket it comes out of –
not your worry – you paid your premiums
2. Remember, if your insurers lips are moving, then they are lying to you;
3. “Cashing Out” is and “Out of Policy” negotiation, and at your option, not
the Insurers;
4. Remain “In Policy” for as long as possible;
5. Ensure:
1. All your damage has been assessed independently (gateway);
2. The method of repair/rebuild to “as new/when new” has been independently
reviewed and then costed as if you were to replicate exactly to the policy, ESPECIALLY
FOUNDATIONS
6. “Cashing Out” should be the very last item to consider not the first
7. Land Claims – Ask who at EQC identified who is and is not “at increased
risk” and why?
8. Your insurer WILL continue to delay until you accept the Reserve Cash Out,
financially they have not other option – DOING nothing is a waste of time,
WAITING is not.