Re: Insurance Payout

Postby philstar on Mon 26/May/14 4:06pm

phunk wrote:
philstar wrote:
thorg wrote:
great uncle bulgaria wrote:
phunk wrote:Market value = ($RRP/2) - (10% * n)

n being the number of years since new.


seems strange: it gives a market value of 50% retail to a one day old bike (and 40 % retail to a 1 year old bike).
I reckon , possibly in ignorance, that my hypothetical 10k bike would sell for more than 4k a year later . . .
The equation works remarkably well in most circumstances, it's just that owners have an inflated sense of what their bikes are worth to other people based on what they themselves paid for them - especially if they pay full retail. . .

the problem is that market value and value to owner, are different things. and i think Market value = ($RRP/2) *(0.9^n) is a better formula as 5yo things are not free


Sure, but since market value is generally a lot less than value to the owner, its best not to underinsure your stuff by selecting and paying for market value.


depends on the cost difference in premiums :) but it does raise a point that if the damage is some one eases fault, why is it market value you get just cos that is what you are insured for? surely you should get replacement value (which is ambiguous for things that are not currently for sale on the open market) but I guess your insurance co is only obliged to negotiate up to insured value, if that is what you are insured for.
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"misanthropic"
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Re: Insurance Payout

Postby CrustyMTB on Mon 26/May/14 8:23pm

philstar wrote:
phunk wrote:
philstar wrote:
thorg wrote:
great uncle bulgaria wrote:
phunk wrote:Market value = ($RRP/2) - (10% * n)

n being the number of years since new.


seems strange: it gives a market value of 50% retail to a one day old bike (and 40 % retail to a 1 year old bike).
I reckon , possibly in ignorance, that my hypothetical 10k bike would sell for more than 4k a year later . . .
The equation works remarkably well in most circumstances, it's just that owners have an inflated sense of what their bikes are worth to other people based on what they themselves paid for them - especially if they pay full retail. . .

the problem is that market value and value to owner, are different things. and i think Market value = ($RRP/2) *(0.9^n) is a better formula as 5yo things are not free


Sure, but since market value is generally a lot less than value to the owner, its best not to underinsure your stuff by selecting and paying for market value.


depends on the cost difference in premiums :) but it does raise a point that if the damage is some one eases fault, why is it market value you get just cos that is what you are insured for? surely you should get replacement value (which is ambiguous for things that are not currently for sale on the open market) but I guess your insurance co is only obliged to negotiate up to insured value, if that is what you are insured for.
No your liability is only ever like for like (which you calculate on market value or a depreciated figure) never new for old. The alternative would be I smash your old shitter and have to buy you shiny newness? Unworkable.
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Re: Insurance Payout

Postby philstar on Tue 27/May/14 4:22pm

CrustyMTB wrote:
philstar wrote:
depends on the cost difference in premiums :) but it does raise a point that if the damage is some one eases fault, why is it market value you get just cos that is what you are insured for? surely you should get replacement value (which is ambiguous for things that are not currently for sale on the open market) but I guess your insurance co is only obliged to negotiate up to insured value, if that is what you are insured for.
No your liability is only ever like for like (which you calculate on market value or a depreciated figure) never new for old. The alternative would be I smash your old shitter and have to buy you shiny newness? Unworkable.


new for old is not what I was trying to imply, my guess to the cause of this confusion is in the term "replacement value" which you have taken to mean "New Replacement value". I was meaning that if you loose and one is selling on the open market (eg trademe) then that is how much you should get. but if one is unavailable for sale then the replacement cost is ambiguous.
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"misanthropic"
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Re: Insurance Payout

Postby Conners on Wed 28/May/14 7:47am

phunk wrote:Market value = ($RRP/2) - (10% * n)

n being the number of years since new.

Thanks for posting that - I was searching for this on here recently and couldn't find it anywhere. I'm sure there was a whole thread dedicated to this subject back in the day...
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Re: Insurance Payout

Postby neels on Wed 28/May/14 10:10am

philstar wrote:
CrustyMTB wrote:
philstar wrote:
depends on the cost difference in premiums :) but it does raise a point that if the damage is some one eases fault, why is it market value you get just cos that is what you are insured for? surely you should get replacement value (which is ambiguous for things that are not currently for sale on the open market) but I guess your insurance co is only obliged to negotiate up to insured value, if that is what you are insured for.
No your liability is only ever like for like (which you calculate on market value or a depreciated figure) never new for old. The alternative would be I smash your old shitter and have to buy you shiny newness? Unworkable.


new for old is not what I was trying to imply, my guess to the cause of this confusion is in the term "replacement value" which you have taken to mean "New Replacement value". I was meaning that if you loose and one is selling on the open market (eg trademe) then that is how much you should get. but if one is unavailable for sale then the replacement cost is ambiguous.

AA insurance do new for old replacement on contents

https://www.aainsurance.co.nz/contents-insurance/
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Re: Insurance Payout

Postby Al_Bushman on Thu 29/May/14 12:49pm

I researched this heaps and found AA was the best for bikes/ sports kit out of the main companies - in particular my bikes and sea kayak. Have been fortunate enough to test them when a bike got stolen and they were great to deal with and they paid out heaps more than what we paid for the original bike despite being shown the proof of purchase etc. I was just asked to get a quote from a LBS for what it would cost to replace said bike in todays market - and they matched that.
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Re: Insurance Payout

Postby UK_Exile on Fri 30/May/14 12:43pm

AMI also does replacement insurance for home contents, but there's a bit in T&Cs saying sporting goods, clothing & few other items are market value. Have been unfortunate enough to have some bike claims & they treated us very fairly. They took average of two bike shop quotes & were more than I would have got on trademe.
UK_Exile
Member for: 12 years 4 months

Re: Insurance Payout

Postby sifter on Fri 30/May/14 4:42pm

Conners wrote:
phunk wrote:Market value = ($RRP/2) - (10% * n)

n being the number of years since new.

Thanks for posting that - I was searching for this on here recently and couldn't find it anywhere. I'm sure there was a whole thread dedicated to this subject back in the day...


is that the same as ($RRP/2) (1-0.1n)? Or, does the 10% per annum apply to the original value?
sifter
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Member for: 13 years 11 months

Re: Insurance Payout

Postby phunk on Fri 30/May/14 5:02pm

sifter wrote:
Conners wrote:
phunk wrote:Market value = ($RRP/2) - (10% * n)

n being the number of years since new.

Thanks for posting that - I was searching for this on here recently and couldn't find it anywhere. I'm sure there was a whole thread dedicated to this subject back in the day...


is that the same as ($RRP/2) (1-0.1n)? Or, does the 10% per annum apply to the original value?


I meant it in the way you have presented it, in that it drops 10% each year, but was too lazy to think it through properly...
phunk
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Member for: 13 years 7 months

Re: Insurance Payout

Postby UK_Exile on Fri 30/May/14 5:10pm

RRP is meaningless in some stores as they virtually always have 1/2 price sale on their inflated RRP. Others don't discount more than 10-30% until near end of model year.
UK_Exile
Member for: 12 years 4 months

Re: Insurance Payout

Postby RussS on Sat 31/May/14 10:21pm

My Giant OCR was flogged a couple months back and AA Insurance replaced it with a new equivalent - including the various accessories that were on it. Of course I had it listed and had current photos of condition and what was attached to it.
RussS
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