Page 38 - Personal Underwriting Mandates & Guidelines - Binder - Version 3

Motor
○ Retail plus value
– If the client’s vehicle is actually worth more than its retail value, the value of the vehicle can be
increased by a percentage above the published retail value.
– Written proof of the value of the vehicle is required in order to provide this increased cover.
– Retail plus value does not cover credit shortfall.
– In the event of a total loss claim, we will base the claim amount on the listed retail value as at the date of the claim event (adjusted by the chosen percentage), plus the sums insured of all the accessories shown in the policy schedule, less the excess.
○ Agreed value
Agreed values may be considered only where the particular motor vehicle code does not appear or no retail value for that vehicle is available in the “Auto Dealer’s Guide”’ or any similar accepted industry authorities, which usually includes vehicles over the age of 15 years, classic vehicles and imported vehicles. Agreed value should ideally only be considered for vehicles that appreciate in value.
The SAIA Code of Conduct places the full onus on the binder holder and insurer to review the vehicle sum insured annually. If a vehicle is insured on an agreed value, a valuation and photographs must be obtained at inception and thereafter at renewal of the policy. Photographs of the vehicle must include all four sides as well as the glass, engine, interior and the odometer reading while the vehicle is switched on.
Risks accepted on the agreed value basis must be approved by Hollard in writing. The request to agree a value must be accompanied by a dealer valuation confirming the condition and value of the vehicle. The following warranty must be stated in the schedule:
Agreed value
If your vehicles value can no longer be determined by reference to the industry authorities, and you have supplied us with written proof of the value of your vehicle, then we may accept that figure and call it the agreed value.
The valuation may be obtained from an expert, such as a motor dealer or motor club. All claims will be settled based on this agreed value, provided you supply an updated valuation at every renewal date of your policy. If you do not, we will use a valuation from an expert, taking into account the condition and mileage of your vehicle.
Please note: This does not apply when Third Party Only cover is selected. The agreed value reference on your policy is deleted if third party cover only is chosen.
Important: We recommend that that the client assesses, at least annually, whether the percentage they have selected is sufficient to cover the adjusted value of the vehicle, particularly as the retail value of the vehicle may decrease annually. Updated written proof of the value of the vehicle would be required if the client wants to change the percentage that they originally selected.
When to choose Retail plus: With second-hand vehicles, it isn’t always clear when accessories were added which makes insuring accessories separately very difficult. In other instances, second-hand vehicles might be worth more than their retail value because of their availability, mint condition or a low mileage. Insuring a vehicle for a percentage more than its retail value can solve this dilemma.
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