With the chaos that has surrounded the opening of Heathrow’s Terminal 5, and the late Easter school holidays upon us, families are looking to take a break and the issue of baggage being lost or delayed is prominent.When travelling abroad, if your luggage is lost or delayed and you need to purchase items such as a change of clothes, hygiene products or any other necessary items, you would expect your insurance policy to reimburse you. Similarly, if your flight was delayed you would expect your insurance policy to provide some form of compensation for you being stuck in the airport lounge.

Defaqto has looked into the single trip travel insurance market to see what cover is provided for lost and delayed baggage as well as being delayed at an airport. The research noted:

•  14% of single trip policies do not provide any cover for delayed baggage.
•  40% of single trip policies only provide a maximum cover of £100 or less for delayed baggage.
•  40% of single trip policies only provide a maximum cover of £100 or less for compensation for flights being delayed.
•  74% of single trip policies provide £20 or less for the first 12 hours of being delayed at the airport.
•  82% of single trip policies provide £20 or less for the each subsequent 12 hours of being delayed at the airport.

Mike Powell, Consultant for General Insurance at Defaqto, said:  “With the problems that have occurred with the opening of Terminal 5 and the fact that there has been widespread reports in the media of people not being able to collect their luggage and flights being cancelled or delayed, consumers do not always consider what cover is provided by their travel insurance policy for these types of eventualities. It is therefore important to check what is provided by a travel insurance policy before purchasing cover.”

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For further information contact:

Defaqto Limited          

Insight person, Chris Johnston or Luci Mylward

01844 295 454

Defaqto’s latest report, “Payment Protection Insurance - 2008  - The party’s over ” predicts that over the next two years there will be a  massive upheaval in the industry as lenders, underwriters and consumers are forced to adjust to consequences that will flow from the judgements of the Competition Commission.With an annual turnover of around £4.5bn and profits in the order of £1.5bn the industry is likely to suffer a severe dilution of profits when the Competition Commission’s statement of remedies is published. If this includes de-coupling the sale of PPI from that of the credit product, this in itself would have a huge impact on the industry. 

As a consequence of the inevitable tightening of the rules under which PPI can be sold, costs and charges across a wide range of other financial products and services will have to rise steeply if banks and credit card companies are to fill the holes in their balance sheets that this will create.

PPI products principally cover protection for loans, credit cards and mortgages but there are significant differences in the way the products are costed and sold. So, while the shortcomings of the PPI industry are well-documented, particularly in connection with the complexity of the products, the sale process itself, the sale to people not covered by the policy and the high cost of some plans, these findings do not apply universally.

PPI policies can and do provide a vital income stream to meet ongoing bills if accident, sickness or unemployment does strike and calls by newspapers and lobby groups to policyholders to cancel their policies could leave them seriously exposed if this advice were followed.

Commenting on the industry, Brian Brown, Head of Insight and lead author of the report said: “We must be very careful not to throw the baby out with the bathwater. PPI has been exploited by lenders as an easy source of profit, but the products themselves can be an extremely valuable.

Policyholders need to carefully examine their personal circumstances and their policy wordings and form a judgement as to whether to retain them, seek cheaper alternatives or drop them altogether.

PPI is the first safety net people fall back on before being forced to claim state benefits and PPI’s detractors should think carefully before advising people to cancel their policies unless they are prepared to accept responsibility for policyholders left unprotected by their advice.”

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Notes to Editors:

¹The report “Payment Protection Insurance - 2008  - The party’s over ” is on sale priced £1,200 excluding VAT for a PDF version and £595 (No VAT payable) for a single printed copy. For further information please contact Chris Johnston on 01844 295457, or the Sales Department on Freephone 0808 1000 804 or visit http://www.defaqto.com/

 For further information contact:

Defaqto Limited 

Brian Brown, Chris Johnston or Luci Mylward

01844 295 454

Valentine’s Day is a chance to demonstrate your love by a gift to your loved one or by whisking them away for a romantic holiday. However, without proper insurance, what starts as a happy day could turn into a nightmare if things go wrong.

If you are planning to give your beloved something expensive you need to make sure that both of you are properly insured. Insuring expensive items when they are taken outside the house is covered by “personal possessions” insurance which is either built in as standard or can be purchased as an optional extra to the home insurance policy. Without this cover, any item of value that is lost or stolen away from the home is not covered. So, if you are intending to propose in a beautiful setting and you lose your nerve or the ring, you can be comforted that you will have another opportunity at a later date without having to dip into your savings.

If you are planning a romantic holiday abroad, the importance of taking out travel insurance is well known, even if it is for only a few days. Costs of medical treatment overseas can be very variable and loss of baggage could prove very expensive without proper cover. Single trip policies can be purchased online and there are many retail outlets, banks and building societies which offer competitive cover.

What is less well known is what happens if something goes wrong when you are travelling to a destination in the UK. If you have already purchased an annual travel policy, It is important to note that with some annual policies, in order for cover to be provided you must have pre-booked at least 2 nights accommodation in a hotel, guest house or the like.

Mike Powell, Consultant - General Insurance at Defaqto said: “By taking a few minutes to check your insurance cover, you can cover your losses from unforeseen problems and help ensure that you and your loved one have a Valentine’s Day to remember, for all the best reasons.”

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For further information contact:

Defaqto Limited 

Mike Powell, Chris Johnston or Luci Mylward

01844 295 454

Following the concerns from the British Insurance Brokers’ Association (BIBA) about comparison websites, the spotlight is well and truly focussed on how these sites operate.What is less well known is that there are some comparison sites that genuinely cover virtually the whole market for their product areas and where products are compared against a set of features and benefits and not price.

These sites are powered by Defaqto Compare which utilises a method of highlighting how different products compare using a simple, yet highly effective, traffic light system. As Defaqto is an independent financial company, users can be certain that the comparisons are impartial and the data is right up to date.

At present Defaqto Compare is held on three insurers’ websites:

• Cornhill Direct - Car, Building and Contents Home Insurance¹
• Hiscox - Buildings and Contents Home Insurance²
• Pet Protect - Cat and Dog Insurance³

Consumers visiting each site will be able to compare the level of cover offered by the host insurer’s product across a number of important product features with the cover levels offered by any other policy. Three coloured symbols and some explanatory text are all that is needed to make very meaningful comparisons for the features shown:

• a green roundel with a tick indicates that the policy meets or exceeds the level of cover provided by the insurer;
• an orange roundel containing an exclamation mark indicates that the level of cover selected can be offered as an optional extra;
• a red roundel with a horizontal while bar means that the policy does not meet the level of cover provided by the insurer.

Brian Brown, Head of Insight at Defaqto said: “We have always emphasised the need for consumers to check out the quality of insurance policies, rather than concentrating just on price. If a policy does not provide the appropriate level of cover, while it may be relatively cheaper than one that does, it could prove very costly if something happened that wasn’t covered or not covered to the right level.”

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Notes to Editors

¹ www.cornhilldirect.co.uk/homeinsurance/homedefaqtoComparisonTool.html

¹ www.cornhilldirect.co.uk/motorinsurance/car/motordefaqtoComparisonTool.html

² www.hiscoxonline.com/jsp/marketing/productsContents.jsp

³ www.petprotect.co.uk/TheRightCover/OurProducts/comparisontool.asp

For further information contact:

Defaqto Limited 

Chris Johnston or Luci Mylward

01844 295 454

According to a recent survey¹, there are 1.8 million pet insurance claims made for veterinary treatment for cats and dogs each year. Unlike most personal insurance products such as home and motor insurance, which can be changed annually, the nature of pet insurance means that it is likely to be taken out for the life of the pet   This is because if pets are treated under one policy and then, at renewal, a new one is taken out, the new insurer generally will not cover any ‘pre-existing’ conditions, and therefore, policyholders  will have to pay for the treatment of these conditions themselves.

Understanding exactly the policy terms relating to the reimbursement of vets’ fees could mean having a policy that covers the cost of your pet’s treatment and one that covered it for a limited sum of money or for a restricted time, or both.

In Defaqto’s recent pet insurance report “The UK Pet Insurance Market - Its bark is worse than its bite,” ² published in December 2007, details are provided as to how the pet market settles claims made for veterinary fees. Essentially, there are three types of methods insurers use to pay veterinary claims:

• Policies that pay vets’ fees on a ‘per condition with a 12 month time limit’ basis will provide cover up to the fee limit or 12 months, whichever is reached first.
• Policies that pay vets’ fees on a ‘per condition limit’ basis will provide cover up to the fee limit. Once this limit has been reached no further cover is provided for the treatment.
• ‘Per year’ policies will pay vets’ fees up to the fee limit, however, provided that the policy is renewed each year, the insurer will continue to provide cover for the treatment.

Mike Powell, Consultant - General Insurance at Defaqto, said: “While superficially straightforward, choosing the right pet insurance policy for your situation will repay the time taken to research what is on offer in the market. 

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Notes to editors

1Sainsbury’s Finance Pet Insurance Data, 2007.

²The report “Pet Insurance in the UK  2007- Bark worse than Bite ” is on sale priced £1,200 excluding VAT for a PDF version and £595 (No VAT payable) for a single printed copy. For further information please contact Chris Johnston on 01844 295457, or the Sales Department on Freephone 0808 1000 804 or visit http://www.defaqto.com/

A press copy of the report is available on request to accredited journalists from Defaqto.

For further information contact:

Defaqto Limited 

Mike Powell, Chris Johnston or Luci Mylward

01844 295 454

Findings by the British Insurers Brokers’ Association (BIBA), following its investigation into price comparison websites, confirm Defaqto’s own findings in its survey of aggregators for its Motor Insurance in the UK report[1] published in October 2007.

Defaqto carried out a detailed study of the services offered by 17 leading aggregator sites, including Moneysupermarket, Confused.com, GoCompare, Comparethemarket and TescoCompare. Key findings in the report were:

• 65% of the aggregator sites had ‘default’ positions for underwriting questions and, in effect, could complete these questions on behalf of the proposer.
• 53% of sites automatically defaulted to a voluntary excess of either £200, £250 and more worryingly £500
• From the quotations obtained, 59% did not actually state who the insurer was.
• Only 47% of the sites analysed provided a “comparison feature” which allowed the proposer to check policy cover information.
• Only 41% of sites actually transferred the correct risk information to the insurer’s/intermediary’s website.
• Only 41% of insurer/intermediary websites matched the initial premium given by the aggregator.
• Only 12% of consumers who applied directly to the insurer/intermediary’s own website were provided with the same premium as provided by the aggregator site.
• 88% of the insurer/intermediary websites needed the proposer either to ‘re-key’ or provide additional information.

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