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Insurance loopholes: What you need to know about car, home and travel insurance (CBC Marketplace)

Jun 09, 2021
This week on Marketplace you think you're covered we came

home

and now we're in financial ruin, but

what

if you're not the average person who loses thousands and thousands of dollars? The promise to protect was angry. It's a crash course in

insurance

. car your

home

your vacation

what

you

need

to

know

that's crazy why we're paying for

insurance

we check the fine print and you're not covered we're in this ice ring of Toronto finding out what's tripping up so many Canadians when it comes to Insurance , we start the lesson with the basics what Tom, are you ready to skate what I don't do for Marketplace how not to fall into the big insurance pitfalls Canadians spend more than $75 billion on insurance to protect the important things in life and the companies that sell those plans are cleaning up why do you buy insurance partly because I have to do it just for security and coverage for my family, kind of unforeseen events in life to protect you in case something happens? your house your car your vacation insurance is there to protect you but what we really want to

know

is if you are covered our first lesson is about your vacation going on vacation this winter I think I'm Cuba Jamaica oh Florida to California but it's not just the sun the that can leave you burned, you can get sick or injured, will you buy

travel

medical insurance?
insurance loopholes what you need to know about car home and travel insurance cbc marketplace
Yes, I usually do, yes, yes, we do. Travel health insurance is cheap, it makes us feel safe, which is why many of us sign up before we fly. Erica

travel

s to Gold River BC to find out why a couple was left out. In the cold, Tracy and Bill Jennings decided it was time for their first trip as snowbirds before setting off, they did what millions of Canadians do: they bought travel health insurance, paid $340, and like Bill, if you have over 60 years old, you must complete a medical questionnaire. So, as far as I knew, he went online, filled it out, thought he had travel health insurance, yes, and apparently he didn't. 10 days into the trip, Bill had chest pains, numbness in his arm, then the bad news, a heart attack, Bill

need

ed it immediately.
insurance loopholes what you need to know about car home and travel insurance cbc marketplace

More Interesting Facts About,

insurance loopholes what you need to know about car home and travel insurance cbc marketplace...

He performed surgery for five blockages in his heart. The surgeon explained that Bill cannot return home because of this because a change in altitude could trigger another heart attack. You have to undergo this very serious operation but at least you won't have the financial stress involved, that's why we bought insurance in the first place unexpected emergency this was unexpected fortunately the surgery went well and they carried on with their life until they returned home 6 Months later the doorbell rang, it was a package containing a letter saying that all of Bill's medical expenses were now our responsibility and what was the grand total of $346,000?
insurance loopholes what you need to know about car home and travel insurance cbc marketplace
Oh, we thought we were going to live in a tent. I think what went wrong even though Bill asked his family doctor for help before filling out that medical form once he made a claim. Manual Life looked at him with his medical history and said he should have answered yes to two questions and that voided his entire policy and Bill is not alone. Dear Mr. Ranson, We recognize that we have heard from dozens of others who have received similar devastating treatments. letters from insurance companies denying your claims your claim is not a policy and is void the bottom line is that there is something wrong in the industry when people are planning a trip they think they have all their teas crossed and eyes dotted we get home and Now we are in financial ruin, the Jennings negotiated a lower hospital bill, but still have to pay $160,000.
insurance loopholes what you need to know about car home and travel insurance cbc marketplace
Ordinary people have lost thousands and thousands of dollars. Susana is with Karp, a nonprofit group that advocates for seniors, and often receives complaints about travel insurance she brought. along with a couple of medical questionnaires that people fill out, she says those questionnaires pretty much set people up to fail, not getting the protection they thought they had just because they made a mistake on a form they couldn't possibly have filled out correctly. know everything that is in your medical record, that is what is expected of them, most people think they know what their medical conditions are, but not in the language that is on the form and that is where the disconnect comes , but the companies say it's technically in writing.
You are wrong, you misrepresented yourself in this questionnaire. You know, I think that's how it is. I don't think you can say you filed everything and can read it for yourself when it takes both a doctor and a lawyer to interpret the form correctly and there's our first lesson in insurance make a mistake on that travel health form, it's not there. covered, so you may be on thin layer of ice on the road, but what happens if you are traveling on a highway? Our next insurance lesson has to do with your car. We are en route to the scene of an accident.
More than one million accident claims are made in Canada each year. The father of hockey, Richard Fisher, is about to add his name to the list, so basically, what happened? It was just that we were driving to the hockey game and they slowed down and I stopped and when I looked in the rearview mirror, this gentleman had hit me, how much damage, any thoughts on yours, he hit me pretty good, so he probably It will be, I guess it will be a few thousand, for sure, but there is an insurance claim that you cannot win the money that you will lose because your car will be worth less after this accident, what about the decrease in value of the car, if you try Sell ​​it for a year or less for now, you'll get less than you would if I hadn't been in the accident, well that's crazy, why are we paying for insurance?
I have never had one and that just burns me because I have never had an accident and I have paid my insurance. I have paid my premiums year after year. How can that be like we said? It's called diminished value or accelerated depreciation, basically, if you sell or trade in your car. After an accident, you will probably have to pay out of pocket even if it is almost like new. I know it's a little complicated, so we'll show you what we mean. We are in this used car showroom in North York, Ontario installing a pair of almost identical used Ford Escapes these people are in the used vehicle market do you have a preference for any of them to look at them or look at them no they don't look very the same they look exactly the same to To me they are more or less the same, but look what happens when we tell them that the vehicle on the right was in a major accident that cost thousands of dollars in repairs.
I take the one on the left. Could you? Oh, I'd probably choose the one on the right. the one on the left, you would expect it to be a better performing vehicle than the one on the right, everyone chooses the car on the left, the one they are told hasn't had an accident. I think when a car is in an accident, even if it has been completely restored, it is never the same as the original, so how much discount would you expect to get for the one in the accident? I definitely want big discounts on that, I don't know, 25% maybe at least 5 grand and that's diminished value when we get back we hit the road with the guy who wants his insurance company to pay for it.
I was angry because it wasn't my fault now my car is $10,000 less and then another insurance story that will make your head spin, I just think you're doing the right thing for your family so it's a shame I didn't see it coming. We are disclosing specific information about the insurance. Are you covered, including something the industry doesn't want you to know: financial loss. suffer from selling your car after being in an accident, well that's crazy, why are we paying for insurance? It's called diminished value and in BC Peter fan goes to court to claim it a few years ago Peter bought a limited edition Dodge Charger. then a truck rear ended the car, the damage went all the way there, wow, so even on the sides and even the side it crumpled the entire back end.
I came home and saw it and couldn't believe my eyes. My baby Peter's insurance covers the cost of the repair, which is about $13,000, but since he likes to trade in his car every few years, he wants to know if the accident will affect what he could get for it. A dealer wouldn't touch it. You wouldn't touch it, what do you mean? Well, they wouldn't really buy it from me because they would have a hard time selling it to another buyer and the second dealer's appraisal is probably about $10,000 less than what he's offering me for market value. your reaction, what did you think?
I was angry, I was angry because it's not my fault now my car is $10,000 less because of someone else's fault for hitting me, so Peter goes back to the Insurance Corporation of British Columbia (ICBC) and asks them to cover it. for diminished value also when you proceeded with this, what was the reaction of ICBC? They basically said there is no such thing, there is no such thing, try telling him to use car dealer Nick Cabani, this car looks in very good condition, it is in very good condition. Yes, he has the M sport package. Any accident, this one here is accident-free and that's the first question he gets from buyers.
Generally, if we say yes, it's game over, they leave, they're not interested anymore. Do you keep the car? So we do it. We get stuck with cars and try not to buy cars with accidents, but the reality is that there are many cars on the roads that have been in accidents. People in the Nick insurance industry are essentially saying that declining value or accelerated appreciation is some kind of mirage, it's not real. What would I say to them? Well it is definitely real because there is a loss, only the one who pays is the insurance company, the insured or the owner of the car, so if it is real, is ICBC included in your coverage?
We ask and they send us. this email ICB DC does not offer this policy and we don't know of any other auto insurance provider in Canada that does, but it's not impossible to find a place where diminished value is covered, just head south to Georgia, If your car has been wrecked and repaired, then it definitely lost its resale value for over a decade. The law here requires that insurance companies must pay for it, so we drove across town to meet the men who helped make this happen. It's designed to make up for it completely and we haven't done that.
I have seen some significant change in insurance rates because of this until recently John Oxendine was the Georgia Insurance Commissioner How much resistance was there from the insurance industry against a law that would apparently make them pay a lot more money? They fought it for years and said it would be terrible and devastating and it really hasn't, the sky hasn't fallen like many people predicted. Peter Fan may have settled his lawsuit just before the trial, a nice thing for an amount that covered the loss. your beloved charger there it is insurance lesson number two selling your car after an accident its value has gone down but it's not covered when we give you back your home is your most prized possession of all I think the beauty of mortgage insurance was that we felt that we we recovered she wasn't you, we're finding that insurance can often leave us out.
One of the most common mistakes we make is thinking we have coverage because we pay for it if you pay a monthly insurance premium on time each year do you believe you are covered true or false true true true true true I would assume it is true I would say it is right our skaters were wrong that's where we start our final lesson on insurance your home from cmore to calgary Southern Alberta was underwater this summer It's shocking, heartbreaking, 100,000 people forced from their homes, we're just trying to keep our basement floods and I can't imagine the whole house disappearing like that 2 weeks later, let's go soon, in Toronto it rains more in 2 hours than it normally rains in the city. in a month and the freezer floating the most expensive natural disaster in the history of Ontario I don't know where to start thousands of homeowners were stunned to find out that the insurance did not cover them we thought the natural disaster covered it but apparently not the floods are one of the most common and costly natural disasters in Canada, but real estate lawyer Bob Aaron says home insurance leaves most of us broke.
Well, people think they have insurance, so they look up the back stairs and say, uhoh, there's 6 inches or 12 inches of water in my basement, I'm covered, it doesn't occur to them that it could be dirty water, it could be clean water, and It makes a big difference for insurance purposes whether the water rises from the bottom or comes down from the walls or windows. which caught so many homeowners by surprise, water damage is covered in most policies but flooding is not included and neither are sewer backups, that's extra for the people at home, they don't care where the water comes from in their minds, they have flood damage.
I have a wet basement, just fix it, send the crew and remove the water and fix it, butthen you find out, but then you find out you're not covered and then there's a big bill and you pay it when As for flooding, the message is: don't assume your house is clean. Leanne Santos found out the hard way that we will have here on Christmas morning about another great Bill family. Millions of us have to pay the mortgage, so this is my husband Lewis. and the girls and I are in the background. Leanne and her husband Lewis signed up for mortgage life insurance if one of them died before the mortgage was paid off, the policy would cover what was left.
I think the beauty of mortgage insurance was that we felt like that, that would protect us, right? My daughters would have, we would always have the house, but her husband died suddenly of a heart attack. He was like my biggest cheerleader, right, and sometimes I worry about the girls, but at least they would get paid more, or so Leanne thought, but her husband misunderstood the form and made a mistake with his medication, and that's when Leanne discovered a practice called post-claim underwriting post-claim underwriting I think she's an evil stepmother I don't think she's a fair friend, you know, I don't think it's explained properly and it doesn't Do you think people understand the extent of what does this happen in your life?
Simply put, the bank gave the policy to Lewis and charged him the premiums without doing a thorough check of his medical records; The insurance company then took a much closer look and denied Leanne's claim. Do you think that's a fair way to deal with people? I don't think it's fair and I think they should do more due diligence when a request is made and if it matches give coverage and if it doesn't match don't give coverage that sounds nice practical advice why insurance companies don't do that probably because it would take too much time and too much money and they are always covered by the fact that if there is a misrepresentation on the application, it's a shame they are off the hook.
You're free and that ends lesson number three, whether it's home insurance or mortgage life insurance, even if you're paying the premiums, you may not be covered, what do you think about that? I don't think it's very fair. We'll investigate a little more, okay, Tom, and we'll push. There is a fine line between preparation and panic. 1 2 three pushes, so what can you do? Make sure you read your insurance policy carefully and whatever you do, don't wait. For disaster to occur, don't fight with me. I'm going back down to find out you're not covered.

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