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How Much Insurance Do You Really Need? · Merryn Talks Money

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Speaker 1: Bloomberg Audio Studios, Podcasts, Radio News.
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Speaker 2: Welcome to Merrin Talks Your Money, the personal finance edition
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Speaker 2: of Merin Talks Money. In these bonus podcasts, we talk
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Speaker 2: about the best strategies for making the most of your money.
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Speaker 2: I'm marinzum'st Web editor at Large with Bloomberg UK Wealth.
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Speaker 3: And I'm joined Stems send your reporter and author of
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Speaker 3: the Money Distilled newsletter.
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Speaker 2: Award winning, award winning Yeah, never let out those never
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Speaker 2: miss out those words. Lest on question for you, John,
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Speaker 2: how much is your life enshued for? Oh?
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Speaker 3: I couldn't possibly see this, which is the Mona Lisa
1:01
Speaker 3: insured for? As well as I don't know?
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Speaker 2: I don't know. I mean, this is an interesting one
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Speaker 2: because I've been looking at this recently. Should my life
1:08
Speaker 2: be insured? And how much should it be insured? Foot?
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Speaker 2: Because I don't think I have life insurance? What do
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Speaker 2: I need to leave behind me? I didn't actually want
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Speaker 2: you to answer that, John. I was more of a
1:19
Speaker 2: rhetorical question than a John, please tell me what I'm
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Speaker 2: worth question. It wasn't that kind of question anyway, It's
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Speaker 2: on my mind. So today we are going to talk
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Speaker 2: about all types of insurances. Insurances you have to have
1:31
Speaker 2: their insurances that you should have and the ones that
1:35
Speaker 2: are fairly flexible. Now, in order to discuss this and
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Speaker 2: get it right, and the man who's going to tell
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Speaker 2: me what I'm worth, we have on with us today,
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Speaker 2: Kevin Ryan. Kevin is an analyst with Bloomberg Intelligence and
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Speaker 2: an expert in consumer insurance. Kevin, thanks for joining us today.
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Speaker 4: Thanks for having me.
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Speaker 2: What do you think I'm worth?
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Speaker 4: Oh, at least five time salary if you're a corporate employee.
2:00
Speaker 2: Yeah, absolutely, And a lot of corporates will just give
2:03
Speaker 2: you this. It'll be in your contract that you get
2:05
Speaker 2: four or five times your salary. Yeah. Personally, I think
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Speaker 2: I'm worth rather more than that, but maybe we won't
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Speaker 2: get into that. Of course, what we want to do
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Speaker 2: today is to talk about all the different types of insurance,
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Speaker 2: what you must have, what you should have, and what
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Speaker 2: might be nice to have. And as far as I know,
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Speaker 2: the only one that is a legal requirement is car insurance.
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Speaker 4: Right, Yes, that's right. You've got to have at least
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Speaker 4: third party insurance if you own or drive a car.
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Speaker 2: And tell us the difference between third party and fully comprehensive.
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Speaker 2: I'm guessing most people know.
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Speaker 4: But third party is just it covers you if you
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Speaker 4: run into somebody or run into somebody's garden more they
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Speaker 4: get paid out, but fully comprehensive covers you for absolutely everything.
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Speaker 4: So if you have an accident and drive into your
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Speaker 4: own brick wall, you can claim on your insurance and
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Speaker 4: get your car repaired.
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Speaker 2: Okay, So with third you drive into another car, your
3:02
Speaker 2: insurance covers all their costs, their medical bills, et cetera,
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Speaker 2: but absolutely none of yours. You are on your own,
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Speaker 2: that's right, But it's very significantly cheaper, presumably.
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Speaker 4: Yes, although I have to say a lot of insurers
3:15
Speaker 4: now don't offer it at all.
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Speaker 2: So yeah, yeah, And do you know what I found
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Speaker 2: out the other day that that not everybody offers anymore.
3:23
Speaker 2: And back in the old days with car insurance, if
3:26
Speaker 2: you had your own car insurance, you were usually automatically
3:29
Speaker 2: third party covered on other people's cars. So you could
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Speaker 2: just jump into someone else's car and not stealing it obviously,
3:35
Speaker 2: but with their permission, and drive off in it and
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Speaker 2: be covered third party. But that doesn't seem to be
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Speaker 2: the case anymore.
3:41
Speaker 4: It certainly is with some policies. I have one like that,
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Speaker 4: oh do. But I think as car insurance has got
3:47
Speaker 4: more competitive price wise with the rise and rise of
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Speaker 4: comparison websites, I think some insurers are pulling back from
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Speaker 4: some of these what they regard as extras.
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Speaker 2: Okay, so when we're getting car insurance, which we have
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Speaker 2: to have, what should we be looking for?
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Speaker 4: I think you need to be looking for things you
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Speaker 4: want and things that insurers will give you a discount
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Speaker 4: if you don't have, like windscreen cover. Windscreens now, particularly
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Speaker 4: in modern cars, are very expensive to replace because they've
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Speaker 4: got radio, aerials and all sorts of sensors in them.
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Speaker 4: So definitely tick the box to have windscreen cover. And
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Speaker 4: the other thing I would tick the box for is
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Speaker 4: having a courtesy car when yours is off the road
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Speaker 4: because because of supply chain logistics and so on, very
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Speaker 4: often even a simple repair like a smash bumper the
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Speaker 4: most common knock, can take several weeks.
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Speaker 2: Okay, Okay, so you need a car, and what about
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Speaker 2: getting insurance for young people? How's the best way to
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Speaker 2: go about that? A big topic of conversation my friends.
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Speaker 4: Yes, I didn't find that a problem when I had
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Speaker 4: that challenge, and one particular insurer was very keen on
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Speaker 4: having young people and it was expensive, but not ruinously so,
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Speaker 4: so I think that the answer is to all of
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Speaker 4: these things is to shop around, and the comparison sites
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Speaker 4: are the place to do that.
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Speaker 2: Okay, And can you tell us from your area of
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Speaker 2: expertise why it is the current insurance has got so
5:21
Speaker 2: much more expensive so quickly. Is that to do with
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Speaker 2: evs being more likely to be written off or harder
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Speaker 2: to repair? Is it to do with the supply chain
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Speaker 2: logistics you'se just mentioned, or is it as we sometimes
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Speaker 2: read in the newspapers that those who do have insurance
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Speaker 2: are paying out lot for the illegal drivers on the road.
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Speaker 4: Well, I think that's a misnomer. Merret, I must pull
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Speaker 4: you up on that, I'm fraid absolutely. If you look
5:45
Speaker 4: at the last confused dot com quarterly motor Price Index,
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Speaker 4: their average cost is seven hundred and twenty six pounds
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Speaker 4: for the fourth quarter of last year, and that's down
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Speaker 4: thirteen percent year over year. So what is curious is
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Speaker 4: that prices are going down. They peaked at nine hundred
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Speaker 4: and ninety five pounds. When was that so? I mean,
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Speaker 4: isn't it a quarter nineteen twenty twenty three?
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Speaker 2: So that was the bit when they went up very
6:14
Speaker 2: dramatically post COVID. They went up from a much lower
6:17
Speaker 2: level than I think you're suggesting they're falling to now.
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Speaker 2: So prices maybe down over a year or so, but
6:23
Speaker 2: they're still fairly comprehensively up on pre COVID levels and
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Speaker 2: higher than inflation.
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Speaker 4: Well, the second quarter twenty twenty three peak only overtook
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Speaker 4: the fourth quarter twenty seventeen by a few pounds. So
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Speaker 4: my view is that we've had a good deal from
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Speaker 4: motor insurers and that in real terms, the price has
6:48
Speaker 4: been pretty flat. And I think the reason we had
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Speaker 4: blip up in twenty three was that they regulator introduced
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Speaker 4: the General Insurance Pricing Practices Rule in first of January
7:02
Speaker 4: twenty twenty two, and that basically meant they couldn't price
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Speaker 4: walk and say lots of portfolios of motor insurance were
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Speaker 4: repriced and settled down, so they spiked, and then they're
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Speaker 4: back to normal. Everybody's where they should be again, and
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Speaker 4: prices are coming off.
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Speaker 2: Okay, great, So everything's absolutely fine. Your motor insurance is
7:22
Speaker 2: pretty much as it was. It's relatively easy to get.
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Speaker 2: You can get third party and comprehensive cover pretty easily,
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Speaker 2: and you can get the additional driver thing we were
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Speaker 2: talking about earlier.
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Speaker 4: You can.
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Speaker 2: Okay, great, I feel a lot better. Right, what so,
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Speaker 2: there's nothing else that's legally required. But the next insurance
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Speaker 2: that you can't have to have legal requirement or not
7:43
Speaker 2: is building insurance.
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Speaker 4: Right, if you own a property, yes, it would be
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Speaker 4: silly not to unless you're very wealthy and you want
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Speaker 4: to stump up the rebuilding cost if something awful happens.
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Speaker 2: Okay, But the mistake that people make there is ensuring
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Speaker 2: their house for the value of their house rather than
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Speaker 2: for the cost of rebuilding their house. Because if your
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Speaker 2: house burns down, it doesn't matter what it was worth.
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Speaker 2: What matters is how much it's going to cost you
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Speaker 2: to find someone to put it up again.
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Speaker 4: Correct.
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Speaker 2: Okay, And if you over insure your house, you're not
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Speaker 2: going to get paid out that. You're just going to
8:20
Speaker 2: get paid what it costs to really.
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Speaker 4: Get paid the rebuilding cost. Insurance is a contract of indemnity.
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Speaker 4: So the deal is you buy buildings insurance, the thing
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Speaker 4: burns down or blows down, and the insuran will come
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Speaker 4: along and reinstate it.
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Speaker 2: Yeah, and there was it. There was a period certainly
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Speaker 2: in Edinburgh. I don't know about in other places where,
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Speaker 2: particularly with older houses, when house prices were very low
8:45
Speaker 2: over the last decade or so, where people were underinsuring
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Speaker 2: their houses for building insurance because it turned out that
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Speaker 2: it cost more to rebuild a Georgian townhouse than it
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Speaker 2: would buy one.
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Speaker 4: I think you've got to be careful with under insurance
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Speaker 4: because the writer can turn around and say you've misrepresented
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Speaker 4: the risk to us, and therefore you have no cover
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Speaker 4: at all. So it's it's a fine line to tread
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Speaker 4: and I think one needs to exercise caution.
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Speaker 3: What is the best way to figure out what the
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Speaker 3: rebuilt cost of your house is? Because I know I
9:20
Speaker 3: think I went on the Rex website. I think a
9:22
Speaker 3: while ago. I've got a pretty normal house. It was
9:25
Speaker 3: just built, you know, like in the nineties, and it's
9:27
Speaker 3: one in the state in thinks there's nothing unusual about
9:29
Speaker 3: it something you can be pretty confident in what they suggested.
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Speaker 3: But if you've got something about quirkier, or should you
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Speaker 3: actually ask someone for a specific valuation or can you
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Speaker 3: just not guess? But you know what, what can what's
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Speaker 3: a good guideline for a sensible buildings insurance valuation.
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Speaker 4: I think there are a number of, as you mentioned,
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Speaker 4: online calculators, and I think ultimately, if in doubt, if
9:57
Speaker 4: you've got a grand house and it's Georgian and it's
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Speaker 4: listed and all the rest of it, I would go
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Speaker 4: on to your insurer and say what would you recommend
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Speaker 4: and put the ball very much in their court and
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Speaker 4: they will help you because they don't want you to
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Speaker 4: be underinsured.
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Speaker 2: Yeah. It feels like the kind of time you should
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Speaker 2: have an insurance broker, right, Yeah, than just buying online.
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Speaker 2: If you have a difficult house.
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Speaker 4: If you've got a difficult house and it doesn't fit
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Speaker 4: the standard big insurers things, then I think you need
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Speaker 4: to go to a large broker that specializes in these
10:30
Speaker 4: sorts of things and they will sort it for you.
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Speaker 2: Okay. Now, the other insurance that almost everybody have, which
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Speaker 2: has which is not compulsory, but I'm sure pretty advisable
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Speaker 2: as contents insurance, right because if your house burns down,
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Speaker 2: the contents are going to be pretty valuable too. And
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Speaker 2: this is the area where a lot of people underinsure
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Speaker 2: and then find that they're in a whole part of
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Speaker 2: trouble when something does happen.
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Speaker 4: Is that right, I think it is. And I think
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Speaker 4: the other thing insurers need to see is receipts for
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Speaker 4: a lot of those things that people will say they've lost,
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Speaker 4: because they need evidence that you had a fifty eight
11:10
Speaker 4: character ring that's somehow melted or whatever.
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Speaker 2: But how can you have a receipt for things you
11:16
Speaker 2: inherited from your granny.
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Speaker 4: It's really difficult, And I think what you need to
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Speaker 4: do there is take a photograph of it, prove that
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Speaker 4: you've got it, it's in the house, it's on your hand,
11:26
Speaker 4: or something like that, and have a jeweler value it,
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Speaker 4: and have that a copy of that receipt somewhere safe,
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Speaker 4: what the jeweler's valuation was, and proving that you actually
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Speaker 4: owned it because it was in your possession via effect.
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Speaker 2: And I suppose the other thing is that in extremists,
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Speaker 2: I mean, that would work for a burglary, but if
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Speaker 2: your house is burnt down, well that's going too all
11:51
Speaker 2: that's going too. I mean, should people really have an
11:54
Speaker 2: inventory of everything valuable in their house held off site.
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Speaker 4: I think they should. I mean, if you if you've
11:59
Speaker 4: got a value portfolio of bits and pieces, then I
12:03
Speaker 4: think you need to do that. And I think if
12:05
Speaker 4: you have got a high value portfolio of shuttles and
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Speaker 4: bits and pieces that the insurer will insist on that.
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Speaker 2: Okay, So it isn't highly possible that you could lose
12:15
Speaker 2: everything and get almost nothing back if you haven't done
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Speaker 2: this slightly horrendous sounding amount of admin.
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Speaker 4: Not quite, But I think where they get sniffy is
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Speaker 4: you know the old rings and the watches, and the paintings.
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Speaker 4: Some of the paintings, yeah, and that you to pay
12:33
Speaker 4: attention to. But other things like your television, your dishwasher,
12:37
Speaker 4: you'll get new for old. So in this instance it's
12:42
Speaker 4: the only insurance that isn't a contract of indemnity because
12:44
Speaker 4: you get new for old. Yeah, because they can't go
12:47
Speaker 4: out and find a two year old Snoozi washing machine
12:50
Speaker 4: or whatever it is you've just lost.
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Speaker 2: Well, there you go. Silver Linings, John, is all your
12:56
Speaker 2: vastly valuable collection of inherited jewelry, probably for graph re
13:00
Speaker 2: seated valued and with the type of store offside. I
13:04
Speaker 2: know you're efficient when it come to admin.
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Speaker 3: I actually believe or not I do. My wife did
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Speaker 3: lose or not or one expensive handbag was stolen many
13:13
Speaker 3: years ago, and that was something we actually did have
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Speaker 3: a receipt for because it was one of the kind
13:21
Speaker 3: of few things that I guess i'd sort of turned
13:23
Speaker 3: around to the insurance said, because they ask you if
13:26
Speaker 3: something's worth over a certain amount, and so it was
13:28
Speaker 3: maybe like one or two things. I can say it
13:31
Speaker 3: would be a pain if you had a lot more stuff,
13:34
Speaker 3: and it's I mean, I can't say that everything in
13:36
Speaker 3: the house is completely itemized, but to be fair, I
13:40
Speaker 3: do take Kevin's point. I mean, if I had an
13:42
Speaker 3: expensive painting on the wall, I probably would, you know,
13:46
Speaker 3: have some proof of ownership of that. So yeah, I
13:50
Speaker 3: mean I can see that makes sense. Actually, I mean
13:53
Speaker 3: I can also say it's a total pain the next
13:55
Speaker 3: so I'm glad that I don't actually own anything, particularly
13:57
Speaker 3: valuu Boss.
13:58
Speaker 2: It's a shame, isn't it. I mean, Kevin, you don't
14:00
Speaker 2: know this, but one of the things that we try
14:01
Speaker 2: and do on this podcast is save people from ADMIN.
14:04
Speaker 2: And now look what we've done.
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Speaker 3: Well, I guess the thing with the ADMIN is you
14:09
Speaker 3: don't want the ADMIN at the point where you need it.
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Speaker 3: It's like one of these things we are you want
14:16
Speaker 3: to have the inventory. They saw that it's not a
14:18
Speaker 3: total if the wast does happen. I guess that's the
14:23
Speaker 3: other point of insurance. Center is mostly there for you're
14:27
Speaker 3: trying to show yourself against catastrophes rather than mayor inconveniencies.
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Speaker 2: Really yeah, okay, fair enough, all right, So what's up next?
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Speaker 2: So we've we've already spent a pile on motor insurance,
14:40
Speaker 2: we spent a pile of building insurance. We've probably spent
14:42
Speaker 2: rather too much on content insurance. After this conversation, what's
14:45
Speaker 2: the next insurance? On our last?
14:47
Speaker 4: Kevin Well, I imagine if you've got a favorite dog
14:53
Speaker 4: or a catch.
14:54
Speaker 2: I do have a favorite dog and when he was
14:57
Speaker 2: run over by a car, we did not have insurance.
15:00
Speaker 2: If you ever come to Scotland, I will introduce you
15:02
Speaker 2: to the most expensive border terrier in the world.
15:06
Speaker 4: So I would recommend people have pet insurance because me too.
15:11
Speaker 4: You know, if a dog does run in the road
15:14
Speaker 4: and need surgery on a leg, that's the same as
15:18
Speaker 4: you going into a private hospital and having the same
15:21
Speaker 4: So it's several thousand pounds, So a dog's leg is
15:24
Speaker 4: about three grand. It's the same as a human leg.
15:27
Speaker 4: And the other thing that you will find if a
15:30
Speaker 4: dog has an accident or a cat and has an operation,
15:34
Speaker 4: they will mandatorily keep it in overnight. And I have
15:39
Speaker 4: to tell you, having been through this process myself once,
15:42
Speaker 4: that it's more expensive than most hotels I stay in
15:45
Speaker 4: on holiday. See, insurance is a good thing here. It's
15:49
Speaker 4: not that expensive if you chop her out.
15:53
Speaker 2: Well, all I would say is that I would be
15:54
Speaker 2: absolutely thrilled if my dog had only broken one leg
15:58
Speaker 2: and only stayed in hospital for one night. Fact, he
16:01
Speaker 2: broke everyone liked to know. He broke two hips leg
16:06
Speaker 2: in one place, six ribs, and had a hernia, and
16:10
Speaker 2: he was in for nearly two weeks. Enjoying the sums
16:13
Speaker 2: on that one. As I say, most expensive border terrier
16:17
Speaker 2: in the entire world. He's available for viewing tenor ago.
16:20
Speaker 3: This six million dollar dog kill.
16:25
Speaker 2: Exactly exactly. Let's pick that one up, though, because you
16:35
Speaker 2: could self ensure with this. You could say, well, my
16:39
Speaker 2: pet insurance is sixty good a month or whatever, and
16:41
Speaker 2: I'm just going to put that into a high interest
16:43
Speaker 2: bank account and I'm going to leave it until something happens.
16:46
Speaker 2: But I think from what I know, and it sounds
16:48
Speaker 2: like you know as well, Kevin, sorry about that, is
16:51
Speaker 2: that that's probably never going to be enough.
16:53
Speaker 4: I don't think it is, because one of the things
16:56
Speaker 4: that's interesting about the veterinary world in the UK is
17:00
Speaker 4: that the prices go up a bit more than CPI.
17:05
Speaker 3: Is there a size of pet where you would suggest size,
17:09
Speaker 3: you know, like like for example, I mean, uh, like
17:12
Speaker 3: we've voided things like budgies and hamsters, and I mean
17:16
Speaker 3: those I must have been don't get insurance for. I
17:19
Speaker 3: won't tell you about the time I got a hysterectomy
17:21
Speaker 3: done in a hamster. I will just part that one
17:24
Speaker 3: for future humiliation. But I'm just saying so I can
17:29
Speaker 3: see the argument for dogs definitely, and obviously horses. I
17:31
Speaker 3: mean that's practically that's like showing the car. But we
17:35
Speaker 3: I can't seem slightly borderline to me low I suppose
17:38
Speaker 3: again that depends on how affectionately you feel for your cat.
17:41
Speaker 2: I don't know, John, I would say cats, yes, But hamsters.
17:45
Speaker 2: We have a friend who's event and you know she
17:46
Speaker 2: says about hamsters.
17:49
Speaker 3: I can't imagine she says.
17:51
Speaker 2: Twenty quid for a new one.
17:57
Speaker 3: That's a compassionate like to hear from her medical professionals.
18:03
Speaker 2: Anyway, moving on, moving on, Given how expensive. It is
18:08
Speaker 2: just to keep a dog in hospital overnight. And by
18:12
Speaker 2: the way I get it, there's the there's the oxygen masks,
18:16
Speaker 2: and the intensive care nurses and the special rum and
18:20
Speaker 2: all that. It's expensive. But if we're going to take
18:22
Speaker 2: out insurance for our border terriers for this, clearly I
18:26
Speaker 2: think you would suggest, Kevin, that we should have our
18:28
Speaker 2: own medical insurance as well.
18:31
Speaker 4: I think that's sensible. And companies like Axer and Aviva
18:36
Speaker 4: have been reporting that take up of their private medical
18:40
Speaker 4: care offering has been booming in recent years.
18:44
Speaker 2: Yeah, well it would be what with the state of
18:46
Speaker 2: the NHS and all that. But the only problem there
18:48
Speaker 2: is that everyone's going private. Eventually you end up with
18:51
Speaker 2: the same cues for going private, right.
18:53
Speaker 4: I don't know, try and live a healthy life, so
18:56
Speaker 4: I don't know.
18:59
Speaker 2: Anyway, it's also very expensive. I mean, you know, you're
19:02
Speaker 2: talking for someone in their forties or fifties, you're talking
19:05
Speaker 2: maybe two or three thousand pounds a year for private
19:07
Speaker 2: medical insurance. So is there a case there for self
19:10
Speaker 2: insuring for saying, okay, do you know what, I'm just
19:12
Speaker 2: going to put that money into a bank account and
19:14
Speaker 2: if I do need a hit replacement for five grand
19:16
Speaker 2: or whatever it is, the money you'll be there and
19:18
Speaker 2: I haven't wasted it on insurance.
19:20
Speaker 4: Yeah, I think I think that's right. I think where
19:23
Speaker 4: it does come into play is if you had some
19:26
Speaker 4: you know, really bad disease or cancer or something that's
19:30
Speaker 4: going to cost considerably more and need urgent treatment more
19:34
Speaker 4: to the point, then I think that's where private health
19:38
Speaker 4: insurance can come into its own. But yes, if you've
19:41
Speaker 4: got the discipline, and this is the thing, I think,
19:44
Speaker 4: the discipline to put a couple of hundred pounds into
19:47
Speaker 4: the high interest account to pay for your hip or
19:52
Speaker 4: broken leg or whatever it happens to be I think
19:55
Speaker 4: might occur, then gave for it.
19:58
Speaker 3: So technically speaking, I guess the NH says there, that's
20:01
Speaker 3: your catastrophe insurance. So if something like an ane type
20:06
Speaker 3: thing happens, then you're kind of covert. And the flip
20:11
Speaker 3: side of that is the the sort of things you
20:14
Speaker 3: would self insured for. I don't know. I can see
20:17
Speaker 3: that self insurance is a little bit more feasible here
20:20
Speaker 3: than it is in the pet case, because if you
20:21
Speaker 3: do it for long enough, and you start early enough,
20:25
Speaker 3: then you probably could conceivably save up enough for a
20:28
Speaker 3: hip operation or something like that and you.
20:31
Speaker 2: Have a bad stop which pets don't.
20:33
Speaker 3: Yeah, yeah, exactly, although I would.
20:36
Speaker 2: Say, can you really rely on NHS any anymore? I mean,
20:39
Speaker 2: I know where I live in Scotland we do not
20:41
Speaker 2: have private anys, but certainly in the South that are
20:43
Speaker 2: private an is now. An't that where you can go
20:45
Speaker 2: and be saying oh in under fourteen hours?
20:50
Speaker 3: Yeah, I do. I think it's a trick you want.
20:53
Speaker 3: And I can see why demands going up your open
20:55
Speaker 3: bank accounts now and they'll do those GPE out of
21:00
Speaker 3: services that you can just fall out and zoom appointment
21:04
Speaker 3: the GP and I kind of thing I can see
21:06
Speaker 3: is really useful because getting a GP appointment, even for
21:10
Speaker 3: just a you know, I cannot be assured part in
21:12
Speaker 3: the head that does not normally doesn't. That's fairly hard
21:17
Speaker 3: these days. Yeah, once appoint am i'd have said you
21:20
Speaker 3: probably don't need medical insurance and they are much more
21:22
Speaker 3: divaded I have to see.
21:24
Speaker 2: Yeah, I mean, if you break your leg, you want
21:26
Speaker 2: to be able to see a doctor before it resets
21:28
Speaker 2: itself in the wrong way, don't you definably? Okay, moving on,
21:34
Speaker 2: so medical insurance if you can there there is some
21:36
Speaker 2: possibility to self ensure that. What next we talk about
21:40
Speaker 2: We talked about the value of my life, which was nice, right,
21:43
Speaker 2: But life insurance a lot of people will get it
21:45
Speaker 2: with work. Everyone should check their contracts, right, they should. Yeah,
21:50
Speaker 2: And if you don't have it through work.
21:52
Speaker 4: I think you need to assess why you need it.
21:55
Speaker 4: I think if you're in a couple and you've got
21:57
Speaker 4: a mortgage, then a bit of life insurance to cover
22:00
Speaker 4: that outstanding mortgage should one of you keel over is
22:05
Speaker 4: a good idea, and it's not hugely expensive for most
22:09
Speaker 4: people with most mortgages.
22:11
Speaker 2: So if you're really young and you're in a relationship
22:14
Speaker 2: and you have a mortgage. In fact, even if you're
22:17
Speaker 2: not in a relationship and you have a mortgage, quite
22:19
Speaker 2: nice to leave behind you a paid off house for somebody,
22:21
Speaker 2: wouldn't it.
22:21
Speaker 4: Well, yes, if you've made other provisions.
22:24
Speaker 2: But less urgent. Okay, So life insurance yes. And now
22:28
Speaker 2: here's another that a lot of people have but may
22:31
Speaker 2: or may not be necessary, which is critical illness insurance.
22:34
Speaker 2: What about that?
22:36
Speaker 4: I think something like that could be really useful for
22:38
Speaker 4: the self employed. So if you become if you're self
22:43
Speaker 4: employed and you suddenly can't do whatever you normally do,
22:47
Speaker 4: whether it's plumbing or a voiceover or whatever, because you've
22:52
Speaker 4: got a broken leg or actually you've been diagnosed with
22:56
Speaker 4: something awful. Then I think, I think that's well worth considering.
23:02
Speaker 4: But it's not cheap.
23:04
Speaker 2: It's not cheap. What does it cost.
23:08
Speaker 4: Well, I haven't got the exact figures, but historically when
23:13
Speaker 4: I've looked at it, I both personally shied away from thinking, well,
23:17
Speaker 4: you know, I just hope I go quickly and the
23:20
Speaker 4: life insurance kicks in.
23:22
Speaker 2: Well, I mean that can be arranged, Kevin, increasingly easily
23:25
Speaker 2: these days.
23:29
Speaker 3: That is a tricky one, though, You're right, because it
23:32
Speaker 3: is again, yeah, I know what you mean. Anything I've
23:36
Speaker 3: kind of thought about, it's one of the most ones.
23:37
Speaker 3: You look at it and you think, actually, that would
23:40
Speaker 3: be a nice to have, but at the same time,
23:42
Speaker 3: it's just way too expensive for covering that particular issue.
23:49
Speaker 3: And I suppose the other thing is some some employers
23:51
Speaker 3: do actually offer it as well. If you're I mean,
23:54
Speaker 3: I think it's a really hard one because it's expensive
23:57
Speaker 3: for them too, But certainly a few places of what
24:00
Speaker 3: with usually be younger over all, what forces they see me,
24:03
Speaker 3: get it cheap and sort of happier. Include it as
24:06
Speaker 3: a payout.
24:06
Speaker 2: Yeah. Does it also sometimes come with life insurance as
24:10
Speaker 2: sort of an optional extra if you buy life insurance, Kevin,
24:12
Speaker 2: will it come with critical illness option?
24:15
Speaker 4: It might do. In some life covers, there will be
24:19
Speaker 4: a clause that says, if you're diagnosed with you know,
24:25
Speaker 4: an end of life an imminent end of life event,
24:29
Speaker 4: they'll pay you out so that you can organize your
24:31
Speaker 4: affairs so.
24:33
Speaker 2: They'll pay Okay, so that's not great. Yeah, sorry, so
24:36
Speaker 2: it's not critical illness insurance.
24:38
Speaker 4: Yeah, but it kicks in if you know, you go
24:41
Speaker 4: to the doctor and they say, I'm very sorry, you
24:43
Speaker 4: need to prepare yourself. You've got just a couple of
24:45
Speaker 4: months or whatever it is they should. Then if you've
24:48
Speaker 4: got that clause in your life policy, pay out the
24:51
Speaker 4: life policy ahead of time.
24:54
Speaker 2: Okay? What happens? Then? What happens if you're diagnosed with
24:57
Speaker 2: a terminal cancer and told you have under a year,
25:00
Speaker 2: for example, and your insurance pays out and you pay
25:04
Speaker 2: a few mortgage all good, and then you go one
25:06
Speaker 2: of those trials and have a miracle cure.
25:09
Speaker 4: Well, I think you where the insurance come.
25:13
Speaker 3: That's the problem every silver I.
25:17
Speaker 2: Know, I know, I would have thought the insurances company
25:20
Speaker 2: would just go well, good for you on you go,
25:22
Speaker 2: But maybe not, right John, Kevin? What else?
25:28
Speaker 4: I think that the big one now is particularly payst
25:32
Speaker 4: COVID is travel insurance. Depending on how much you pay
25:37
Speaker 4: and all the rest of it, that can be.
25:40
Speaker 2: Useful, I mean surely. I mean I would say travel
25:43
Speaker 2: assurance was compulsory. I'd never go away without it. Could
25:48
Speaker 2: anyone go away without travel insurance? And would you go
25:50
Speaker 2: to America without travel insurance? That would be insane?
25:54
Speaker 4: Well, I suspect lots of people do, particularly in Europe.
25:57
Speaker 2: But you can get an easy hr Is that what
26:01
Speaker 2: it's called? E hr ken Yeah, which kind of covers
26:03
Speaker 2: you from medical expenses, right, yeah.
26:06
Speaker 3: Yeah, e heck, I think it is. Sorry, no, I
26:11
Speaker 3: think I think trouble making documents.
26:17
Speaker 2: Absolutely trouble making all over the place. Sorry everybody, apologies,
26:22
Speaker 2: just got off a long whole flight. John, You never
26:25
Speaker 2: go anywhere with that traveling you're ind.
26:28
Speaker 3: I feel I've always had a drummed enemy from a
26:31
Speaker 3: young age about getting repatriated off a mountain seede, even
26:34
Speaker 3: though I'm never on a mountain side. So yeah, but yeah,
26:39
Speaker 3: I can see actually who people may be a bit
26:42
Speaker 3: cavalier about it. Going to Europe, I think anywhere outside
26:45
Speaker 3: of Europe, for definite, you should have travel insurance. And
26:48
Speaker 3: it is cheap. It's not an expensive thing. Yeah, multi exactly.
26:56
Speaker 2: Yeah, And I found out the other day. Wait the
26:59
Speaker 2: other day, by the way, when I was going broad
27:02
Speaker 2: for a few days to work and didn't have insurance.
27:04
Speaker 2: I thought I should have a separate business travel insurance.
27:06
Speaker 2: But does that not?
27:07
Speaker 1: So?
27:07
Speaker 2: Most revel insurance travels you for leisure and for shr
27:10
Speaker 2: business trips. Is that right, Kevin? Or was I just lucky? Now?
27:13
Speaker 4: I think that's probably right. The other thing to look
27:16
Speaker 4: at is your if you've got a homeowner's policy, is
27:19
Speaker 4: to look at that because quite often you're insurer will
27:23
Speaker 4: extend that into.
27:24
Speaker 2: Travel and your credit card as well, right, I mean,
27:27
Speaker 2: certainly a lot of American Express cards, assuming you pay
27:29
Speaker 2: for the trip with your American Express card, will cover
27:32
Speaker 2: you while you're away. I'm assume that's true of lots
27:33
Speaker 2: of credit cards.
27:34
Speaker 4: Yeah, And it's definitely a perk to look out for,
27:39
Speaker 4: because if you do get stranded, they will pay for
27:41
Speaker 4: the hotel, the new flight, et cetera.
27:45
Speaker 2: Okay, well that's that's that last one. Anything else or
27:48
Speaker 2: are we are we actually there? Now? This has been
27:50
Speaker 2: a very very expensive podcast.
27:54
Speaker 4: Well, I think that the thing you can reassure listeners
27:57
Speaker 4: with is that that the main things like make and homeowners,
28:01
Speaker 4: the price is actually going down so.
28:05
Speaker 2: Great.
28:05
Speaker 4: You know, buildings only cover according to Consumer Intelligence, held
28:09
Speaker 4: two point two percent in the fourth quarter.
28:12
Speaker 2: Why do we think that is when the cost of
28:14
Speaker 2: construction are going up so much and we hear of
28:17
Speaker 2: nothing but the cost of construction rising and rising in
28:20
Speaker 2: how impossible is to build anything because the bill cost
28:22
Speaker 2: is so high, etc. Why would the cost of ensuring
28:24
Speaker 2: be falling? Is it maybe because there are fewer fires
28:27
Speaker 2: than there used to be, Fewer buildings fall down, fewer
28:31
Speaker 2: bits full of buildings onto other people's heads. I mean,
28:33
Speaker 2: is it simply about that?
28:35
Speaker 4: No, I think it's about insurers with lots of capital
28:40
Speaker 4: and there's plenty of competition, so the competition in the
28:44
Speaker 4: UK market remains intense for these main big ticket items, well,
28:49
Speaker 4: big premium pools like motor like homeowners.
28:54
Speaker 2: Brilliant John, Yeah.
28:57
Speaker 3: I mean the other thing I would say is that
28:59
Speaker 3: it's concessed. Certainly, in my experience, it's consistently been worth
29:04
Speaker 3: shopping around when you get your renewal. I mean, just
29:08
Speaker 3: this year, I'm iced to save one hundred and fifty
29:10
Speaker 3: pounds off my buildings insurance, and it wasn't it wasn't
29:13
Speaker 3: that high. In the first place. The quote came in
29:15
Speaker 3: for I think it was it was three hundred, then
29:18
Speaker 3: it came in at four hundred, and so I just
29:20
Speaker 3: went to a comparison site, put it in and I
29:22
Speaker 3: got it back for two fifty. And I mean, you know,
29:25
Speaker 3: it's and it's the same on car insurance and all this.
29:28
Speaker 3: It's very rarely. During COVID was the one time I
29:32
Speaker 3: did notice that it was pointless to shop around or
29:36
Speaker 3: do the comparison site thing when your renewal came in,
29:38
Speaker 3: because it was literally a matter at like a tenor
29:41
Speaker 3: or something like that, and there was a waste of time.
29:43
Speaker 3: But other than that, I must have met most years,
29:44
Speaker 3: I consistently find that you can save a reasonable amount
29:48
Speaker 3: of money and it doesn't take that long. Much as
29:51
Speaker 3: I hate admin, famously hate admin, so yeah, yeah, definitely,
29:56
Speaker 3: I think shopping around makes a lot of sense.
29:58
Speaker 2: Well, there you go. Who needs Martin lew when you've
30:00
Speaker 2: got John stappack right brilliant? Thank you both so much.
30:08
Speaker 2: That was super useful, and off you go, everyone to
30:11
Speaker 2: your admin photographs of all your jewelry after the valuers, etc.
30:16
Speaker 2: I don't know if I'm going to be doing that.
30:18
Speaker 2: Maybe I just don't have enough of value to make
30:20
Speaker 2: it worth it, as I put it on my long
30:22
Speaker 2: term list to do one day in the distant distant future.
30:27
Speaker 2: Thanks for listening to this week's Marrin Jugs your money.
30:30
Speaker 2: If you like our show, rate review, and subscribe wherever
30:32
Speaker 2: you listen to podcast. Also be sure to follow me
30:34
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30:36
Speaker 2: John Underscore step Pack. This episode was produced by Summer
30:39
Speaker 2: Sardi and Moses and questions and comments on this show
30:42
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30:45
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