I’ve been reflecting on my experiences dealing with insurance claims after natural disasters.
Living in an area prone to such events, it’s essential to understand how insurance coverage is determined. I’d like to share my recent encounters and seek your insights on the matter.
Experience 1: 2014
Back in 2014, I faced the aftermath of a frozen copper pipe that burst and required repair. The insurance company’s response was consistent: “Get a quote. If the quote is less than ¥200,000, we can’t provide coverage.” Interestingly, the plumber inflated the quote from ¥15,000 to meet the threshold, even though additional work was performed beyond the immediate issue.
Experience 2: 2023
Fast forward to 2023, I encountered a different situation involving a stretched fabric tent sign that detached from its frame due to Typhoon 6. Once again, the insurance company suggested obtaining a quote for ¥200,000. This time, again, the extent of damage seemed nowhere near that value. Surprisingly, a representative from the insurance office even encouraged pursuing a quote for exactly ¥200,000.
I’m left wondering about the motives behind this threshold and if there might be any dishonesty involved. Has anyone else encountered similar situations? Could you shed light on the rationale behind the ¥200,000 benchmark? Your insights and experiences would be greatly appreciated.
Let’s pool our collective knowledge to better understand this aspect of insurance claims after natural disasters.
Thank you for your time and contributions.
4 comments
first experience is literal 水増し請求
I’m not well versed in Natural disaster insurance but this blogpost captures what you’re trying to talk about quite well
[https://coat.ne.jp/column/inflated-bill/](https://coat.ne.jp/column/inflated-bill/)
First, you should follow the news more, since insurance fraud has been a hot topic recently (Bigmotor and Sompo Japan).
Second, what you’re describing is a franchise deductible clause. The intent of the clause is to prevent payouts. The threshold is set high enough so the insurance company isn’t paying out too often. Whereas with a standard deductible, the threshold might be set lower, but the insuree is eating some of the cost of every claim they make. In practice, franchise deductibles encourage insurance claims to be inflated to meet the threshold. As a result, standard deductibles are becoming more common.
In your first case, presumably the plumber gets paid more for doing more repairs, so it was in his interest to inflate his quote.
The second case sounds more like the Bigmotor/Sompo Japan case, but who knows.
“Let’s all talk publicly about our past experiences committing insurance fraud!”
I’ll pass, thanks.
I did the same with a few claims .. it’s not a big deal ..