Direct Line and Factory Options

[st13phil]

Like most people I shop around for insurance each year and over the last few have alternated between Direct Line and Aviva when either one of them wouldn't do a deal at renewal time. In January this year I renewed with Direct Line.

Then I had a rush of blood to the brain and decided to buy an E63 AMG which is loaded with lots of factory options. Before I decided on the purchase I did the sensible thing of checking annual premiums (as new business) with both Direct Line and Aviva. Astonishingly both were only a very modest sum - i.e. less than £50 - more than the premium I paid 3 months ago for my E350CDI, so I decided to go ahead and buy the car. As I purchased it from a Mercedes-Benz dealer I took advantage of the free 7-day cover as it was easier than trying to time the changeover from insuring one car to the other (I know from old that Direct Line flatly refuse to offer temporary dual vehicle cover).

So, on Sunday I phone Direct Line to swap the policy on to my E63 and that's when the fun starts. "Are there any modifications to the vehicle?", I'm asked. I reply that there are no modifications, but that the car has many factory-fitted options. "Ah", says the lady on the phone, "I'll have to note what the options are". Fair enough, so I start to list them.

At the end of the list I'm then asked about what the option packages (Driving Assistance Package, Luxury Package, etc.) comprise. When I get to the Performance Package Plus she had difficulty in grasping that it wasn't an aftermarket remap or chip tuning, but actually just a state of tune that the car left the factory in. Eventually she says that she'll have to take advice "because the underwriters often refuse anything that increases performance". She says that her enquiries may take some time so she'll call me back. Hmmm...

After a while she does, indeed, call back to tell me that the underwriter wants the PPP treated as though it were a remap, and will load the premium accordingly. Hmmm. She then asks how much the carbon-fibre rear spoiler cost. I explain that it was part of a package and therefore I couldn't say how much it cost. She then asked if I could question the manufacturer to get a cost of the rear spoiler as the underwriter wouldn't proceed unless they had the cost At that point I realised that I was wasting my time and politely said that in view of the unanswerable questions that I was being posed, I'd be taking my business elsewhere. So, the Direct Line policy was cancelled with a return premium on a straight pro-rata basis, and ten minutes later I had a new policy set up with Aviva - who couldn't give a stuff about any of the options - for roughly the same price as the basic Direct Line quote.

So, be aware that Direct Line now require that you identify all factory options on your car, and that they get awfully nervous about some of them.

 

[KillerHERTZ]

It came out of the factory like that, not sure why you brought it up to be honest? It's not modified in the sense which insurance companies care about!

Your too honest

 

[acej]

Direct line wanted to up my insurance for my c63 by 250 because it had carbon fibre mirrors!! That's nearly a 30% loading.. I am no longer with them.

 

[Sp!ke]

Ibrecently insured with Direct Line and they were only interested in non factory options.

I suspect you had a call handler without a clue.

 

[A-AvantGarde]

I've had similar issues with my insurers in the past, both with our modified C320 and my BMW Gran Turismo with quite a few factory options. Some insurers refuse to cover with multiple mods!

Admiral wanted to know the full spec of the GT including all options and packs. We had a multi-car policy at the time and they were one of the few companies that would cover the W203 with numerous declared mods. Whilst I could have kept quiet about the modifications that wouldn't be right, repairers typically use the VIN to order parts. I've modified my W203 with: lowered suspension, upgraded brakes, AMG kit, AMG alloys, rear privacy tints, upgraded exhaust etc.

Modifications from standard spec, like my W203 I can understand. However, the factory fitted options declaration seems strange.

Anyway, come renewal time I moved to LV and they're only interested in the spec as delivered. Again, the W203 has all mods declared!

 

[acej]

Admiral charged me £57 for up to a 15% Bhp upgrade on my SL, good value. Direct line wouldn't let me modify under my policy.

 

[TDE1]

It came out of the factory like that, not sure why you brought it up to be honest? It's not modified in the sense which insurance companies care about!

Your too honest

Really, KH?

It is not a 'normal' E63. I suspect the original underwriter was doing his/her best to accommodate. I'd guess repair costs would differ, it's more attractive to the jealous underbelly of society, and there's the moral hazard - folk who like faster cars usually like them for a reason - and I'm sure it's more attractive to ne'er do wells. Might we agree on that?

If st13phil would be happy with a total loss valuation (or repair costs) based a non-PPP model, then fair enough, but why take the risk of non-disclosure which would potentially invalidate a policy? It's a fantastic, expensive, premium car, so why take a chance on the insurance?

Insurers do have differing stances , but if you've declared all, then you have peace of mind.

Sorry to sound like I'm carping on, but I spend enough time getting policyholders out of trouble for (often accidental) non-disclosure.

(And Phil, yes insurers do get nervous about some options... but AFAIK, the AMG PPP is not quite the same as opting for a cup holder and spare wheel ).

Just an insurance bod's humble opinion, no offence meant.

Tim

 

[def90cars]

I normally work on the principle I supply them the VIN or number plate, it's their job to work out the car.

I think you were too honest.

p.s. I have experience of claims are cars with factory options and never an issue.

 

[markjay]

I suspect that both are true - you provided information that was not requested, and you had an inexperienced call handler.

It is difficult to generalise about insurance companies based on such conversations - call again and speak to someone else, and you may get a different answer...

 

[p3tchy]

Are there any modifications = No

End of.

I would have said no more. Should/if you need to claim, the onus is on them to find an E63 without this STANDARD equipment.

 

[C43AMG]

I recently renewed the CL's insurance and as I have had it remapped and a LSD fitted I declared it, which was fine an extra £47.00.

We have just finished an extension which included a double garage where the CL now resides, before it lived on the drive, So I mentioned it to the lady and she said that will be a £ 13.00 increase in your premium. I asked her to explain the logic behind the increase. She just said that was the company's policy, no further explanation was forth coming and very indignant that I did not believe her. Spoke to her manager, he could not believe what she had said and he apologised and gave me a £ 47.00 discount.

Amazing.

 

[KillerHERTZ]

Really, KH?

It is not a 'normal' E63. I suspect the original underwriter was doing his/her best to accommodate. I'd guess repair costs would differ, it's more attractive to the jealous underbelly of society, and there's the moral hazard - folk who like faster cars usually like them for a reason - and I'm sure it's more attractive to ne'er do wells. Might we agree on that?

If st13phil would be happy with a total loss valuation (or repair costs) based a non-PPP model, then fair enough, but why take the risk of non-disclosure which would potentially invalidate a policy? It's a fantastic, expensive, premium car, so why take a chance on the insurance?

Insurers do have differing stances , but if you've declared all, then you have peace of mind.

Sorry to sound like I'm carping on, but I spend enough time getting policyholders out of trouble for (often accidental) non-disclosure.

(And Phil, yes insurers do get nervous about some options... but AFAIK, the AMG PPP is not quite the same as opting for a cup holder and spare wheel ).

Just an insurance bod's humble opinion, no offence meant.

Tim

It came out of the factory that way no? theirfore there is no reason to declare it as any different!?! Any bodyshop would use its VIN number to replace parts like for like.

Its not modified in any way then, as far as the insurance company is concerned its surely the same as any other model leaving the factory.

Informing a call centre worker that you had fitted different brand headlight bulbs would no doubt result in an increase in premuim aswell.

 

[IanA2]

It came out of the factory that way no? theirfore there is no reason to declare it as any different!?! Any bodyshop would use its VIN number to replace parts like for like.

Its not modified in any way then, as far as the insurance company is concerned its surely the same as any other model leaving the factory.

Informing a call centre worker that you had fitted different brand headlight bulbs would no doubt result in an increase in premuim aswell.

I'm with KH on this one. It's a long time since I had anything to do with insurance, but as far as I am aware, modifications are changes made after the car comes out of the factory. Therefore if you buy "Car XXX GT extra blah" then that is the car to be insured, as it is, as it came from the factory. It has not been modified and therefore needs no declarations.

 

[KillerHERTZ]

10 secs on Google brings up this on the Confused.com insurance website:

When you compare car insurance prices, you’ll be asked on your application form if your vehicle has been modified from its original or factory condition

The AMG PP left the factory like that, it has not been modifed.

 

[IanA2]

10 secs on Google brings up this on the Confused.com insurance website:



The AMG PP left the factory like that, it has not been modifed.

Quite.

 

[BTB 500]

I'm with KH on this one. It's a long time since I had anything to do with insurance, but as far as I am aware, modifications are changes made after the car comes out of the factory. Therefore if you buy "Car XXX GT extra blah" then that is the car to be insured, as it is, as it came from the factory. It has not been modified and therefore needs no declarations.

As already mentioned though, factory options like body kits or special alloys may significantly increase the repair cost if the car is involved in an accident (compared to the same model in standard spec.), so it doesn't seem unreasonable to me for them to be a factor when calculating a premium

 

[IanA2]

As already mentioned though, factory options like body kits or special alloys may significantly increase the repair cost if the car is involved in an accident (compared to the same model in standard spec.), so it doesn't seem unreasonable to me for them to be a factor when calculating a premium

Agreed.

However, should I have to declare the body kit on my AMG? Sure it costs silly amounts of money. But the fact is, it's a standard fitting on the car. They are the insurers, they should know that when they insure my car that it has the body kit.

I do think that they should be aware of the condition at the factory gate and that it is their responsibility to establish that and quote accordingly.

 

[st13phil]

People are focussing on the concept of "modifications", but that's not what this is about.

For the benefit of those who have said I was too honest or that I should have kept quiet, or that the Direct Line call handler was inexperienced, it’s worth taking a look at the "Assumptions" section of the Direct Line web application which you either have to declare as true or untrue before they will provide a quote. The key statement relating to this instance is:

"Your vehicle has not been changed from the manufacturer's standard specification (including wheels, suspension, bodywork and engine)."​

Note that there is no indication of any question as to when the vehicle has been changed from the manufacturer's standard specification, just whether or not it deviates from that. Clearly - to me, anyway - to be able to answer the question truthfully in the affirmative the vehicle has to be to the base spec with no options, and hence why I answered honestly that it has multiple build-time options included. Had I not done so then I would have failed to disclose potentially material information and in the event of a claim the insurer would have the option of voiding the policy (if they deemed the lack of disclosure to be serious enough) or to restrict payment of benefits.

I would argue that rather than being inexperienced, the Direct Line call handler I dealt with actually understood their employer's requirement for disclosure and was acting correctly. The interesting scenario would be if I'd mentioned that the car was fitted with a number of build-time options but had been told by the call handler that "those don't matter". In that case, I would have discharged my responsibility to disclose material information but the underwriter's agent, i.e. the call handler, had chosen not to record that information. In those circumstances I'd argue that the insurer could not reasonably void the policy or restrict benefits under it in the event of a claim. By the way, I think the situation would be different if it were a broker who chose not to record such information as they act as an agent for the insured, not the insurer.

Compare this to the Aviva quotation process where there is no equivalent declaration regarding vehicle specification required. Instead, they ask the direct question: "Is this vehicle modified?", and also provide the definition of what "modified" means in the context of the question:

"A modification is an alteration to the specification of the vehicle which was not included when the vehicle was first registered. Modifications include features to improve performance, appearance, comfort or safety. They do not include minor additions like mud flaps, floor mats, seat covers etc."​

Note that this definition clearly states that only modifications made after the vehicle was first registered are of interest. In the absence of any further questions regarding optional equipment, it's therefore not necessary to draw the insurer's attention to any build-time options the vehicle has fitted.

If st13phil would be happy with a total loss valuation (or repair costs) based a non-PPP model, then fair enough, but why take the risk of non-disclosure which would potentially invalidate a policy? It's a fantastic, expensive, premium car, so why take a chance on the insurance?

Insurers do have differing stances , but if you've declared all, then you have peace of mind.

This is exactly why I acted as I did. I wouldn't be happy with a total loss valuation or repair costs based on a standard car, and nor would I take the risk of non-disclosure that might invalidate a policy.

I suspect that many people with cars such as Mercedes-Benz or BMW where options are commonplace fall foul of the Direct Line declaration either wittingly or unwittingly. Whether or not Direct Line chooses to exercise their rights as a result of non-disclosure in the event of a claim is their business, but is it worth giving them that option?

By the way: my experience of the insurance industry over the last 35+ years (both motor and household) is that the frontline people the consumer deals with often don't understand the product they're selling, and sometimes get things hopelessly wrong (as in Peter's case). I've also found that it's very important to read and understand proposal declarations, policy and other documents so that you don't end up finding out that you don't have the cover you thought you had when the wheel comes off...

 

[IanA2]

But surely there is no change to the manufacturers standard specification, for that car. You are not talking about other models, but the model you are insuring. Ergo it is the standard spec.

 

[BTB 500]

But surely there is no change to the manufacturers standard specification, for that car. You are not talking about other models, but the model you are insuring. Ergo it is the standard spec.

The model is an E63. It has the optional performance package plus - which is not part of the standard spec.