Not happy

I would like to lodge a formal complaint regarding the cellphone insurance claims process and, specifically, how the insured value and premiums are treated when the value of the cellphone depreciates over time.

I initially contacted Customer Care because I had several questions about insuring my existing iPhone 13 128GB. Unfortunately, the Customer Care agent was unable to provide clear answers to some of my questions and eventually transferred me to the Claims Department.

During my conversation with the Claims Department, I specifically asked the following:

If my iPhone 13 is ****** in the future and the exact model is no longer available as a new device, what would Pineapple consider a “similar new item”? Would I receive an equivalent/newer iPhone, another brand, or a cash settlement?

I was informed that Pineapple does not simply pay out the amount for which the phone was originally insured. Instead, if the phone cannot be sourced, a voucher may be provided based on the value/price of the applicable device at the time of the claim.

This raises a serious concern for me.

For example, if I insure my phone for R10,000 and continue paying premiums based on that insured value for two years, but the replacement value of the phone has decreased to R8,000 by the time I make a valid claim, my understanding is that the settlement could be based on the lower value at that time.

I therefore asked a very straightforward question:

If the value used to determine my potential claim settlement decreases over time, why does the insurance premium not automatically decrease accordingly?

Unfortunately, I was told by the Claims Department representative that she could not answer this because she does not work in the department responsible for premiums.

I find this concerning because, as a customer, I should not have to contact multiple departments simply to understand the fundamental financial mechanics of the insurance product I am considering purchasing.

I fully understand that insurance policies have terms, conditions, excesses and valuation mechanisms. My concern is specifically about the relationship between the amount used to calculate my premium, the compensation limit shown on my policy, and the actual amount that may be used to settle a claim in the future.

I would therefore like Pineapple to provide a clear written explanation of:

1. How my cellphone’s value is determined when the policy is activated. 2. How my premium is calculated based on that value. 3. Whether the premium automatically decreases as the cellphone depreciates. 4. If it does not decrease, why the premium remains based on the original insured value while the potential claim settlement can decrease over time. 5. Whether the amount shown as my compensation limit represents a guaranteed maximum settlement or merely the maximum amount subject to the replacement-value assessment at the time of the claim. 6. How Pineapple would determine the value of an iPhone 13 128GB if it is ****** several years after the policy was activated and the exact model is no longer available as a new device. 7. In that situation, how Pineapple determines the device or voucher value that would be offered to the customer.

I am raising this complaint because I want to understand exactly what I am paying for before entering into the insurance contract.

I would appreciate a written response from the appropriate department, rather than being referred between Customer Care, Claims and other departments.