Insurance replacement of a caravan

[Buckman]

If you are unfortunate enough to have your caravan stolen and it is then replaced on the new for old policy by the insurance company, how would CRA 2015 be applied? It is the insurance company that has bought the caravan and the contract is between the dealer and the buyer. We have never had a caravan or car stolen in the UK so do not know if the insurance company send you a cheque or whether they source and buy the caravan for you.

 

[ProfJohnL]

If you are unfortunate enough to have your caravan stolen and it is then replaced on the new for old policy by the insurance company, how would CRA 2015 be applied? It is the insurance company that has bought the caravan and the contract is between the dealer and the buyer. We have never had a caravan or car stolen in the UK so do not know if the insurance company send you a cheque or whether they source and buy the caravan for you.

I suspect it will depend on the insurer you use and the specific policy details that will determine how the insurer replaces new for old. That might also determine how the CRA would be applied to teh replacement goods. As it stands the CRA applies to between the retail customer and the seller. Obviously if you receive a payment from the insurer and you use it to buy a new caravan then the CRA would be with the dealer.

If the insurer finds and purchases the caravan for you and effectively gives it to you, then I suspect it would rest jointly between the dealer and the insurance company much as it would if you had used a finance house yourself. But Ill admit i'm not certain on this.

 

[Raywood]

It would depend on how the claim was settled. With most caravan claims, the insurance company will allow you to buy from your local dealer, although they will pay the costs up to the sum insured for you. This allows you to trade up or change makes if you want to, and means there is a contract between you and the dealer.
If for any reason the insurer sources the caravan for you, then possibly the contract is with the insurer, although it is one to provide you with the caravan. It could be said that the insurer is purchasing on your behalf so the dealer still has a contract with you via the insurer, but this is a grey area and I am not aware of any cases involving this point. If the caravan is faulty that may even give you a claim against the insurer if it held that they were the purchaser, it all gets a bit complicated though.
In general the exact lost caravan will not be available as a new model except for very new one as things will have moved on, so the insurer replacing it is unlikely. Replacement by the insurer is common in the motor insurance market but far less so in caravan insurance.
The only reason an insurer would want to replace the caravan themselves would be if they thought they could get a better deal, but that would mean them getting an agreement with the trade and the numbers any one company would have to replace in a year might be too low for them to do a deal. You could imagine one of the bigger ones might get a deal from a large group like Marquis who could supply most models, whereas very few others can offer that range. The policy terms do allow them to do this if they wish though.

 

[Buckman]

Thanks Raywood and specifically why I mentioned new for old policy. I seem to recall that the CMC used to source the caravan for you to replace the stolen one, but no idea what they now do with their Caravan Cover which is not an insurance policy?

 

[Parksy]

We had a new caravan replaced under a CCC Clubcare insurance new for old policy in 2007.
We'd bought a brand new Abbey 590 which was written off in the floods of July 2007.
Clubcare agreed that we could have a replacement caravan to the value of the sum insured.
We were free to choose any make or model that we liked, so we upgraded to a 2008 t/a Abbey 620 which we took delivery of in March 2008.
The delay was caused by us,
Clubcare settled the sum of insured accessories such as TV, awning, Aquaroll, battery and Wastemaster by cheque paid directly to us within a couple of weeks, but because we'd been on a seasonal pitch which was now defunct I held off choosing the replacement caravan until the Autumn sales to reduce the price difference that we'd need to pay because of the upgrade.
The dealership agreed to hold off on delivery until March 2008 which was a great help, we saved 6 months storage fees.
I managed to get 1300 off the 'screen price' of the replacement caravan plus free delivery by waiting for the dealership sale.
We paid a small deposit to the dealership for the new caravan and we simply put them in touch with our insurer who settled with them.
The sales contract was between ourselves and the dealer with no further involvement from Clubcare except to insure the replacement caravan new for old as before.

 

[ProfJohnL]

Thanks Raywood and specifically why I mentioned new for old policy. I seem to recall that the CMC used to source the caravan for you to replace the stolen one, but no idea what they now do with their Caravan Cover which is not an insurance policy?

Oh yes it is an insurance policy.

Any process that a third party provides a monetary amount or goods if a prescribed loss is endured is an insurance policy.

 

[RayS]

£ years ago our caravan was written off due to structural damage having hit a concealed object. . The van was less than 5 years old and covered by CC/CAMC insurance. Under this policy it should have been replaced with a 'similar' new caravan with the insurer providing the quotation from a particular dealer. But, and it's a big but, you had the choice of taking purchase price quoted in cash . This was offered early in the negotiation. The sum included some allowance for the additions made to the caravan and due to inflation over four years the sum was more than I had paid for the original caravan. I was fortunate to get a very rapid assessment and the cheque arrived exactly one month from the day I posted the claim. The underwriters and loss adjusters concerned communicated in an efficient and pleasant manner. Although by nature a bit picky I cannot fault the process in any way.


Unfortunately a current claim under CAMC Red Pennant policy is not being handled in any thing like the same way.

 

[Niall_McIntosh]

Oh yes it is an insurance policy.

Any process that a third party provides a monetary amount or goods if a prescribed loss is endured is an insurance policy.

The CAMC Caravan Cover is not an insurance policy as it is not provided by a regulated insurance company and there is no contractual right to be indemnified following an insured event. As it is not an insurance policy, it is not subject to Insurance Premium Tax.

The document itself does not call itself an insurance policy and refers to Caravan Cover, not insurance. It also contains the following preamble:
"We offer cover on a discretionary basis which means that your Executive Committee has sole and absolute discretion on deciding claims and may accept or reject claims in its discretion. It also means that the Executive Committee may, in its discretion, agree a claim which falls outside the terms of the Caravan Cover, or which may even be expressly excluded, if the circumstances warrant it. The discretionary cover we provide is not a contract of insurance, and The Caravan Club Limited is not regulated as an insurance company. "

 

[ProfJohnL]

It would be interesting to see how the courts would deem it, as they are offering a cover all be it under their own discretion, if someone was to challenge it.

Its more like a warranty scheme, which is a contracted policy and the warranty holder is liable to meet events falling within the terms and conditions.

They may not be called an insurance but they function in much the same way.

 

[Niall_McIntosh]

This sort of cover is not unheard of in the commercial market, and is often provided by what is called a Discretionary Mutual, where membership of the Mutual is exclusive to a particular type of business or organisation. The Mutual itself is usually protected by a (re)insurance policy in case claims exceed expectations. In addition, there will also have to be insurance in force in respect of compulsory insurance, such as Employers' Liability, where the insurer will issue the required EL Certificate, and pick up any residual liability in respect of claims, should the Mutual cease to exist.

 

[RogerL]

Seems to me to just be a way of avoiding paying the Insurance Premium Tax and avoiding being regulated.

 

[Niall_McIntosh]

I have certainly heard that view expressed before........

 

[otherclive]

Seems to me to just be a way of avoiding paying the Insurance Premium Tax and avoiding being regulated.

The cover has been re insured as a group protection policy through a regulated insurer who are subject to FCA regulation. The Caravan Cover policy details the complaints procedures and there is access to the Financial Ombudsman too. The CHMC aren’t some fly by night outfit so I really don’t know what people’s concerns are. The cover is comprehensive and claims are assessed by a reputable insurance asssesor.

 

[Buckman]

Oh yes it is an insurance policy.

Any process that a third party provides a monetary amount or goods if a prescribed loss is endured is an insurance policy.

I think you need to be reading the wording again as it is no longer an insurance policy and the wording makes this quite clear.

 

[otherclive]

I think you need to be reading the wording again as it is no longer an insurance policy and the wording makes this quite clear.

Yes on their website Caravan Cover is a separate box to follow. Motorhome, Campervan specifically state “insurance” on their respective boxes that lead you to more information. I used to work for an organisation that never took out insurance, but had resources to cover itself.

 

[Niall_McIntosh]

Yes on their website Caravan Cover is a separate box to follow. Motorhome, Campervan specifically state “insurance” on their respective boxes that lead you to more information. I used to work for an organisation that never took out insurance, but had resources to cover itself.

That may be because, with the exception of the Home Insurance, the other covers contain Compulsory Insurance elements, such as Motor Third Party Liability, which has to be insured with an Authorised Insurer which has to issue a Certificate of Motor Insurance.

I assume the organisation you used to work for was one of those specifically exempted in the Legislation?

 

[otherclive]

That may be because, with the exception of the Home Insurance, the other covers contain Compulsory Insurance elements, such as Motor Third Party Liability, which has to be insured with an Authorised Insurer which has to issue a Certificate of Motor Insurance.

I assume the organisation you used to work for was one of those specifically exempted in the Legislation?

Yes thanks. I was just adding to Buckmans posting that it is not an insurance policy wheras campervans and motorhome policies are conventional motor insurance.

 

[Raywood]

The criticism of the CAMH policy does seem to be based on a misunderstanding of the concept. In practice the cover is as secure as any other policy and they have retained your right to take a dispute to the Financial Ombudsman. There is no valid reason not to take it out if the premium is acceptable to you.

 

[RogerL]

The criticism of the CAMH policy does seem to be based on a misunderstanding of the concept. In practice the cover is as secure as any other policy and they have retained your right to take a dispute to the Financial Ombudsman. There is no valid reason not to take it out if the premium is acceptable to you.

Any misunderstanding is self-inflicted by not explaining the benefit, if any, of the change to the policyholders.

Clearly the C&MC benefits from lower costs in not paying Insurance Premium Tax and less accountability by not being regulated but how does the policyholder benefit?

 

[Buckman]

The criticism of the CAMH policy does seem to be based on a misunderstanding of the concept. In practice the cover is as secure as any other policy and they have retained your right to take a dispute to the Financial Ombudsman. There is no valid reason not to take it out if the premium is acceptable to you.

Once they have an established track record with the Caravan Cover we may re-consider, but at the moment preferred to stick with an established insurance company. BTW I doubt very much if the FOS can do anything if you are unfortunate enough to have to escalate a complaint as it is not an insurance product however I would think this is highly unlikely to happen.
Just to add, we did take out what we thought was an insurance policy in 2018 and only when we received the documentation did we realised that we had Caravan Cover and not an insurance policy. We quickly cancel and took out an insurance policy. At the time the website did not make it very cleare regarding the product you were buying.
Would an insurance company accept your No Claims inherited from the CMC as technically I suppose you cannot have any No Claims as you never had an insurance policy?