Not everyone enjoys sitting in the safety of their home, reading a book in their spare time. Some may prefer to head out to the track and tear it up on their bike or behind the driver’s wheel.
However, when looking for life insurance cover, one of those clients is more likely to receive complete cover for their activities than the other.
Lawrence Shamrakov, financial adviser at Adapt Wealth Management, raised the concern on LinkedIn, where he asked other advisers for their help.
“We have a client who does some occasional amateur car racing around local race tracks. His current insurer has put a blanket exclusion on all racing activities for life/tpd/trauma and income protection,” Shamrakov told Australian Risk Advisers group members.
Advisers responded that most insurance companies will exclude motor sports, but according to Timothy van Doore, owner & managing principal of Stream Financial, there is hope if clients meet certain criteria.
“Often this type of amateur racing around a track is time trials. If there are other cars on the track and they are racing for position it is different. Time trials is against the clock. Find out what it actually is and see if it fits the criteria,” he suggested.
For instance, BT offers standard rates on cover with no exclusions provided it is for social participation only – no internationals. It includes go karts, vintage cars, off roads, time trials, rallies and hill climbs, said van Doore.
Paul Crane from Wealth Evolution has also discovered that this information is vital when approaching an underwriter. His client was in a classic street car club that arranged drag races.
“Drag racing raised alarm bells but I was very patient in my explanation over frequency, engine size, speeds, regular fuels etc. In my view there is greater risk driving his regular car to work on the freeway,” said Crane.
“Like all ‘unusual’ past times some underwriters are prepared to listen and others prefer to take the easy option and exclude/ decline at outset.”
Have you struggled to get any 'unusual' hobbies covered by insurers?