Tuesday, September 15, 2009

What If?

The idea behind insurance is obvious. You pay a little out on a regular basis and it will save you worrying about an unexpected piece of bad fortune. You will be covered if something goes terribly wrong. Wikipedia (taking the larger picture here, I feel) defines insurance ‘as a guaranteed and known small loss to prevent a large, possibly devastating loss’. In Spain, of course, this is not entirely the case.
Here, you pay your insurance and everything goes fine. Keep up the payments why don’t you. However, if the caca hits the ventilator, it’s amazing how often the insurance company will smilingly explain why they don’t, actually, have to cough up a penny, see, because of this or that fascinating and little-known escape clause often referred to as ‘an act of God’.
In the old days, it was a ‘do as you would be done by’ arrangement with your neighbours. Their house burns down, then it follows that you must help them to build them another one. ‘Must’, because, what happens if it’s your house that has been immolated? Insurance is therefore a very civilized arrangement.
So we have Neighbourhood Watch. It’s in our interest to keep an eye out for strange faces, or cars, or people with black eye masks, striped jerseys and carrying a large bolt cutter from Lopez. We have rejas on our windows, a telephone on the night table and, for American readers, as likely as not we have an arsenal of well-oiled and fully loaded semi-automatics under the bed. You never know when you might need them.
Community insurance makes sense, but what about when the driving force is not social, but commercial? We are obliged to carry various different types of insurance thanks to the law, yet the cover comes from commercial companies. I have a car, a ton of metal that thunders along at 70kph while I’m fiddling with the CD player, so I must insure it, at least against me having an accident (while listening to Beethoven). Yet, the government allows different private insurers to essentially fight over the right to be my shining beacon in troubled seas. A few years ago, and thanks to the new rule of not having to actually carry an insurance receipt in the car (don’t worry, the nice policeman knows), it became clear to me one day after checking my bank statements that I had two policies on the same car. One was 200 euros more expensive than the other. Indignant (and mystified), I told the bank-clerk who then wanted to know which one did I want to cancel. Well, how about the more expensive one, hey?
Some of the readers of this piece will have worked (or still work) in the insurance business and they will no doubt argue about the obvious and overriding benefits of ‘peace of mind’. But, thanks to the profit margin, insurance is still stacked against the customer. For example, if I have three cars, how can I be driving more than one of them at any one time? Insure me, the driver, rather than the vehicle! Charge more for the young or inexperienced driver, but not for the car. I will grant you that here in Spain, we all pull a fast one on the insurance: ‘yes, it’s for me’, we say, patting some sporty little motorcycle with distaste, ‘the boy may just use it occasionally…’ But, have you seen the premiums on those things?
So, we must carry insurance, fundamentally, in order that we are seen to do so by the traffic police. That’s moving far away from the basic and logical reason to be covered, isn’t it?
Unlike car or work insurance (which is bloody expensive and almost utterly useless if you happen to be autonomo - self-employed), house insurance is voluntary. Well, I think it is. I have a mortgage, but when the fire came, I was told that the mandatory coverage I must pay for the pleasure of borrowing was, in fact, a life insurance.
I did have private home insurance for a while. A high wind blew the roof off the stables and the insurance perito, the assayer, said that they would only pay out if the wind was over a 100kph. I said that if the roof fell off, it didn’t matter if the wind was 1kph, but luckily, a contact from Garrucha Port gave me a certificate to say that the wind on that day had been 110kph. So the company coughed. Another time, when part of the ceiling fell in on my sleeping son, who was saved by little short of a miracle, the company went with the ‘act of God’ routine and I gave up bothering.
In several cases following the recent fire, home insurers found out that their outbuildings or land were not insured. Some of Spain’s major companies – who spend a suspiciously large amount on television advertising – were talking quickly about ‘the small print’ to their bemused customers.
Sevillana is meant to pay when there’s a power surge, but when the recent fire blew the electric and fried my computer and the telly, the man on the phone assured me that it was ‘a fortuitous act’ and therefore not covered by their service contract. They obviously don’t believe in God at the Sevillana.
It’s clear that a commercial company doesn’t make money by handing out for claims, and the perito’s job must be to minimize the insurance company’s obligations. It’s just strange, with this in mind, how Lloyds of London, for which my batty old step-mother was a ‘name’, always managed to report the most alarming losses. When she died, I discovered that she practically single-handedly had insured the twin towers, which seemed on balance rather unlikely. They cleaned out her account though…
I do have one insurance which is quite excellent. This is the Sanitas, the Spanish private health which has stood by our many problems and innumerable hospital visits over the past few years. So, with this fine company in mind, insurance can sometimes be a life-saver. Just don’t forget to read the small print.

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