CAR CLINIC: We’re carrying less passengers, shouldn’t we pay less premiums? - Beaking Kenya News

Beaking Kenya News

Where It All Happens

Breaking Kenya News

Websites Development

Websites Development
Get a Website at a Small Fee

Translate

Wednesday, 3 June 2020

CAR CLINIC: We’re carrying less passengers, shouldn’t we pay less premiums?

PREMIUMS
Hello Baraza,
I hope you and your family are fine during this challenging period. Life as we know it has changed and this pandemic had destroyed many businesses. I am in the matatu business and the curfew plus the stringent measures put in place by the government, such as reducing the number of passengers by almost half to curb the spread of the coronavirus has immensely slashed our profit.

Unfortunately, our insurance underwriters still charge us the same monthly premiums even though we carry less passengers. Our complaints have fallen on deaf ears even though we are incurring big losses.
Please advise how we can address this with relevant authorities.

Hello,
That virus has sure done a number on us, huh? Well, those who survive to see the other side of this pandemic are those that adapt quickest and best to the not-so-brave new world we currently live in.
I take it your message is meant to be a continuation of the past two weeks' saga, no? At least that is what I promised my readers, so we will treat it as such.
From an insurance perspective, it is more or less the third series (or season) of their programme, the first being an article I wrote on May 20, 2015.
The highlight was AIG Insurance company declaring that they will not provide comprehensive insurance for any BMW or Subaru vehicles valued at Sh1.5 million or less.
It made for quite a laugh, but I had my own conjecture about the move, the guess being these brands at those price points are preferred by hot-blooded yuppies, the adventurous kind that take spontaneous road trips and drink on a Monday.
Needless to say, the happy-go-lucky ways of this particular demographic make for a poor road safety record and I presume AIG got tired of paying out claims when the yuppies inevitably wrecked their "reasonably priced" automobiles at an alarming frequency. Drinking on a Monday is not good.
BUSINESS
(Full disclosure: I own a Subaru and a BMW, among other cars. Needless to say, AIG will not be getting any business from me since none of these vehicles is even close to the million-shilling mark in value. Also, do not draw conclusions about any carefree tendencies or poor road safety record on my end.
In spite of the car brands festooning my driveway, I am a physicist by training and a motoring aficionado by trade, which means I am a stickler for order and my driving history is close to impeccable.)
The second season premiered in August last year when I put the word out on something bearing a bit of a misnomer: Autocorrect.
Yes, it is a spell-checking bit of software that curtails severe embarrassment for people who cannot play Scrabble to save their lives, but it is also the brand name for another piece of software: a kind of tracker that lets the controller (Heritage Insurance) determine what kind of driver you are: are you in the motoring-columnist, religious-undertaker end of the scale or do you drive like you just bought a turbocharged Subaru with your first bonus check while still in your early twenties and are trying to impress patently disinterested slay queens with your familiarity of the Sony PlayStation?
Your track record determines how much they charge you for premiums and whether or not they will compensate you if your BMW ends up on a flatbed and on a police report.
SHIFT GEARS
The third season, which has lasted the longest - three weeks - is reaching its finale today with you. It's gone on long enough anyway, time to shift gears to other things, but let's wrap this up first.
Just a recap of this season so far: we have had drama involving a fearsome Asian with a non-Asian name kidnapping lawyers and detaining vehicles because the insurance company involved balked at paying his invoice from hell, prompting the clearly flustered owner of the vehicle to rally her troops and send them into my social media circles to seek literary assistance from the greatest columnist this country has ever seen. Now we are up to speed.
There is a bottom line to all three cases, and that is the bottom line: the books, the finances, the cabbage, the guap, the mullah. In each instance, the respective underwriters are doing their damnedest to cut overheads without alienating their client base, be it culling the undesirables outright (Subaru drivers are a lot better behaved nowadays, come to think of it), acting out Big Brother fantasies through CIA-type surveillance (I'm not sure I want strangers to know I was clocking 209 km/h along the bypass on Tuesday night - not that I did it, I'm just saying) or playing the exclusivity card and having a members-only club for garages (the criteria to join the list must be quite something). Whatever the case, the valve labeled "Money Out" needs a smaller clearance. That is normal in a capitalist society.
PREMIUMS
And then we have you and your matatus.
Now, I have never insured a matatu, but I am made to understand the policies calculate their premiums based on the carrying capacity, so I get where you are coming from. However... isn't it a bit too soon to be making judgment calls? There is a reason SARS Cov 2 is called "the novel coronavirus": it is new to us, and so is the martial law it is forcing us to live under - social distancing being a key component of that law hence the 50 percent maximum passenger capacity limit imposed on all vehicles.
Insurance companies are huge sprawling megaliths with bureaucracy that would rival the obscurest department in the least active ministry of the reddest state imaginable, so try and picture how long it will take before the board meetings get to Section XII, Subsection J of Agenda 37: "Revising The Premium Payments Of Public Service Vehicles As A Result of Health & Governmental Directives In Response To The Global Pandemic of 2020".
They have to first get their house in order - what with companies laying off staff, reporting losses, wondering whether careless exposure of oneself to Covid-19 infection is sufficient grounds to reject claims, having to buy gallons of hand sanitiser for all their offices, performing compulsory feng shui in their premises to accommodate the social distancing directive for the employees who survive the purge... their hands are full at the moment.
However! Last week, "Earl" (not his real name), said something that I went on to emphasise: engage, engage, engage! Walking into an insurance office and telling the receptionist "Yo, this gosh-danged disease done got us against the wall, you reckon you can be a darling and trim down on them premiums for me, pretty please? Thanks," will not get any results. And "Aww, shucks!" is not a reaction equal to or greater in measure than the rejection that will predictably follow. You have to be a bit more proactive than that.
Matatus belong to Saccos, no? And you owners have an association right? Use them. These organisations have powerful leaderships whose joint decisions can have far-reaching consequences for partnering entities. I told “Fiona” (not her real name), that there is safety in numbers. This applies here as well: gang up in your respective Saccos or associations or cliques and make a stand. Demand dialogue and declare your grievances unequivocally with no relenting until a mutually agreeable solution is arrived at.
You have your own skin to watch out for but guess what, so does the insurance company. If your interests clash and you stay mum about it, you are the one who suffers. Mobilise! Viva!
All the best in your quest for fairness in the industry, and stay safe.

No comments:

HOME

Pages