Are you covered for a UFO crash?
Brokers must often deal with unreasonable clients and contend with rather strange and usual claims. We took a light-hearted look at the new international insurance approach.
While claims for freak household disasters are nothing new, what sort of response would you get from your insurance company if a UFO or a shark crashed into your house?
Specialist insurance broker Adrian Flux in the UK recently did an informal study by phoning various insurance companies to see if they would cover policyholders on some strange scenarios.
How strange is strange?
What if a meteorite was to strike the policyholder's house?
No problem, they said. It would be covered.
How about a stampede of wildebeest on the run from a local safari park?
Covered.
What if a vindictive ex-husband bulldozes the policyholder's home to the ground?
Yes, that too.
How about if a shark fell through the roof?
Covered, but if it was a work of art then there would be an excess, with conditions attached.
And a UFO?
Yes, of course.
Is it likely?
It is estimated that one in two Americans have experienced a UFO sighting and the incidence and reports of strange sightings continue around the world. In January this year, a UFO was speculated to be the cause of a destroyed wind turbine in Lincolnshire in the UK. Changing weather patterns and new technology are also changing the risks that policyholders face.
While these events are probably highly unlikely, it is exactly the purpose of insurance to cover unforeseen and unexpected events that would result in loss or damage.
Insurance approach
Julie Carter of Flux says that when the company's Household division was set up ten years ago, many insurance companies would sniff at meeting bizarre claims, and ‘Act of Alien' would be classed alongside ‘Act of God'
.
"Freak household disasters have taken place before, and if a bizarre event happens to a householder, too often they fear the response from an insurer. They worry that it will be up to the policyholder to prove that, for example, a little green man was responsible."
However, things have improved in recent years, and many companies offer more flexible insurance that caters for a wider range of risks. "If you are going to modify your house, you need to tell your insurer what you've done. And if that includes putting a flying saucer landing pad on the roof, you need to be sure it can bear the weight. So fears about household insurance not covering the improbable are now misplaced," concludes Carter.
