Insurance rant

[iggletiggle]

JuanGandini said:

It was my first year with them but I've not heard of that type of business model before for insurance - I pay for insurance one year at a time, not like phone or TV contracts for a 2-3 year contract where they often can subsidise the monthly price for the first few months or so. Needless to say, they've lost my business now!

Quite a lot of the 'Cheaper' insurers do this in year 1 - the following years become expensive to compensate for the new business offers. Loyalty with some companies doesn't mean anything as they rely on the small % of people who just renew. The industry has been like this for years, its not something i agree with but then the whole motor insurance industry is completely bonkers through and through.

[Vaud]

iggletiggle said:

Quite a lot of the 'Cheaper' insurers do this in year 1 - the following years become expensive to compensate for the new business offers. Loyalty with some companies doesn't mean anything as they rely on the small % of people who just renew. The industry has been like this for years, its not something i agree with but then the whole motor insurance industry is completely bonkers through and through.

I think you would be surprised at the % that auto renew.

[StottyEvo]

Soov535 said:

JuanGandini said:

Soov535 said:

JuanGandini said:

It didn't happen outside my house. I was visiting a family member.

I've had no previous claims of any sort in 18 years of driving.

You are STATISTCALLY a person who parks their car in places where it gets hit.

Sorry.

No. I'm statistically a person who parked a car on a cul de sac in which another driver reversed out of a driveway into my parked car and then drove off.

Thanks for the sympathy though. It's gutting!

Statistically, you park in more dangerous places than someone who hasn't been driven into!!

They probably don't want your business - you've cost them money!!!

Admiral load you premium exactly the same if the accident is non-fault not resulting in a claim or a fault accident causing £100,000 damage.

The statistics may show if you've had a crash you're more likely to have another, but the statistics aren't very specific. Which I'm presuming is what is so irksome.

If they were more specific, I'd assume a non-fault accident would hit you premium less than an at fault, at which point the OP has a meaningful gripe.

[moffat]

xRIEx said:

If you can suggest a better one, go for it.


In all my years in broking (admittedly many of those in support services to broking) I've never heard of an insurer loading a premium due to a non-fault accident where all losses had been recovered - this seems to be the preserve of the aggregators/comparison sites.

You do realise that it's not the aggregator providing the quote right? An insurer or broker is providing premium back to the aggregator - the aggregator cannot load onto that price.

[xRIEx]

moffat said:

xRIEx said:

If you can suggest a better one, go for it.


In all my years in broking (admittedly many of those in support services to broking) I've never heard of an insurer loading a premium due to a non-fault accident where all losses had been recovered - this seems to be the preserve of the aggregators/comparison sites.

You do realise that it's not the aggregator providing the quote right? An insurer or broker is providing premium back to the aggregator - the aggregator cannot load onto that price.

Yes I'm aware, I am also aware that different quote systems and portals will generate different quotes due to different data/quoting structures. As I mentioned earlier, aggregators pass less information to the insurers than the insurers' own systems would request, sometimes resulting in different prices.

[anonymous-user]

Wouldn't the the increased renewal be classed as an unisured loss relating to the accident?

[TwigtheWonderkid]

xRIEx said:

McSam said:

Soov535 said:

You are STATISTCALLY a person who parks their car in places where it gets hit.

Sorry.

Exactly. This thread comes up at least once a week, and the answer is always the same. It wasn't your fault, you "shouldn't" suffer for it, it may not be completely fair in your situation and there could be a great reason that shows it should never happen again. But you are (quite reasonably) perceived as a higher risk, and therefore have to pay a larger premium.

It's as simple as that.

See, this is what I don't accept. Your risk profile doesn't change in respect to being hit (especially hit when parked). There is exactly the same statistical chance of being hit before the accident as after, because the risk is affected by the acting party, i.e. the driver at fault. Their risk to the insurance pool has already been accounted for by the premium they pay.

That's rubbish. He was visiting a family member in a cul de sac. He has a greater chance of being in that location again than I do. I don't even know his family!!! Next time the same neighbour may do the same thing and this time no one will witness it! That'll cost his insurers. Or if it's a very tight cul de sac, he might get hit by another neighbour.

[xRIEx]

TwigtheWonderkid said:

xRIEx said:

McSam said:

Soov535 said:

You are STATISTCALLY a person who parks their car in places where it gets hit.

Sorry.

Exactly. This thread comes up at least once a week, and the answer is always the same. It wasn't your fault, you "shouldn't" suffer for it, it may not be completely fair in your situation and there could be a great reason that shows it should never happen again. But you are (quite reasonably) perceived as a higher risk, and therefore have to pay a larger premium.

It's as simple as that.

See, this is what I don't accept. Your risk profile doesn't change in respect to being hit (especially hit when parked). There is exactly the same statistical chance of being hit before the accident as after, because the risk is affected by the acting party, i.e. the driver at fault. Their risk to the insurance pool has already been accounted for by the premium they pay.

That's rubbish. He was visiting a family member in a cul de sac. He has a greater chance of being in that location again than I do. I don't even know his family!!! Next time the same neighbour may do the same thing and this time no one will witness it! That'll cost his insurers. Or if it's a very tight cul de sac, he might get hit by another neighbour.

How does the insurer know it's a family member and that he'll be visiting them again?

How do they know if the at fault party was a resident or regular traveler to that area? They may have been doing a one off visit.

[TwigtheWonderkid]

xRIEx said:

How does the insurer know it's a family member and that he'll be visiting them again?

How do they know if the at fault party was a resident or regular traveler to that area? They may have been doing a one off visit.

Oh ffs! They don't. How do they know a 17 year old will have more claims than a 57 year old. How do they know someone with cancer will die before someone in perfect health? It's not about individuals.

What they do know is that if they take 1000 people who have had a non fault claim and compare them to 1000 people who have had no claims, more of the first group will go on to have further claims than the 2nd group.

[xRIEx]

TwigtheWonderkid said:

xRIEx said:

How does the insurer know it's a family member and that he'll be visiting them again?

How do they know if the at fault party was a resident or regular traveler to that area? They may have been doing a one off visit.

Oh ffs! They don't. How do they know a 17 year old will have more claims than a 57 year old. How do they know someone with cancer will die before someone in perfect health? It's not about individuals.

What they do know is that if they take 1000 people who have had a non fault claim and compare them to 1000 people who have had no claims, more of the first group will go on to have further claims than the 2nd group.

And that (highlighted) would be correlation not causation.

What would be the proximate cause for this observation? Do you even know if such data that demonstrates this exists, or are you just assuming it does? If you have the stats I'd be interested to see them.

ETA: Your first paragraph is irrelevant as that relates to fault claims.

[TwigtheWonderkid]

xRIEx said:

And that (highlighted) would be correlation not causation.

What would be the proximate cause for this observation? Do you even know if such data that demonstrates this exists, or are you just assuming it does? If you have the stats I'd be interested to see them.

If it didn't exist, why would insurers charge extra? It's a competitive market, so if there was no extra risk, some insurers wouldn't charge to clean up on the business.

The stats insurers have can now be broken down within different sectors thanks to enhanced technology, so an insurer my charge extra for a non fault claim for certain age groups, but not for others. Or extra for a non fault claim if you live in a city, but not if you live in the country.

On the face of it, keeping your car on the drive is a lower risk than keeping it on the road. But if you drive a car that can only be stolen with the keys, the drive becomes a higher risk as the thief knows which house to break into for the keys. So the owners of some cars get charged extra for keeping it on a driveway, whilst others get a discount.

The stats available to insurers is incredibly detailed. The fact that some insurers charge more for some risks due to the driver having a non fault claim is proof that in some circumstances it represents a higher risk.

[Pothole]

JuanGandini said:

xRIEx said:

McSam said:

Soov535 said:

You are STATISTCALLY a person who parks their car in places where it gets hit.

Sorry.

Exactly. This thread comes up at least once a week, and the answer is always the same. It wasn't your fault, you "shouldn't" suffer for it, it may not be completely fair in your situation and there could be a great reason that shows it should never happen again. But you are (quite reasonably) perceived as a higher risk, and therefore have to pay a larger premium.

It's as simple as that.

See, this is what I don't accept. Your risk profile doesn't change in respect to being hit (especially hit when parked). There is exactly the same statistical chance of being hit before the accident as after, because the risk is affected by the acting party, i.e. the driver at fault. Their risk to the insurance pool has already been accounted for by the premium they pay.

It's not like flowers attracting bees, where a different colour of flower might attract more insects (although a darker colour may be less visible so more at risk, it might be interesting to see; still the car doesn't change colour after an accident); being crashed into once does not suddenly make your car magnetic or somehow more likely to attract bad drivers.

If a particular area shows a high risk of being crashed into, say CW7, then sure, you could say that parking there represents a higher risk. However, if you live there you've already stated your postcode and that will already have been taken into account to calculate the premium; if you don't live there, the insurer isn't going to know that you're going to park there because they don't ask, "what postcodes are you going to park your car in during the forthcoming year?" or "where do your friends live that you regularly vist?"

Very well put xRIEx! I totally agree. Should the premiums not be loaded against the parties at fault for accidents rather than those who are not? Why should non-fault parties be punished because some algorithm determines they now statistically were involved in a claim regardless of fault?

now you're just asking for it to be FAIR! WTF?

[xRIEx]

TwigtheWonderkid said:

xRIEx said:

And that (highlighted) would be correlation not causation.

What would be the proximate cause for this observation? Do you even know if such data that demonstrates this exists, or are you just assuming it does? If you have the stats I'd be interested to see them.

If it didn't exist, why would insurers charge extra? It's a competitive market, so if there was no extra risk, some insurers wouldn't charge to clean up on the business.

The stats insurers have can now be broken down within different sectors thanks to enhanced technology, so an insurer my charge extra for a non fault claim for certain age groups, but not for others. Or extra for a non fault claim if you live in a city, but not if you live in the country.

On the face of it, keeping your car on the drive is a lower risk than keeping it on the road. But if you drive a car that can only be stolen with the keys, the drive becomes a higher risk as the thief knows which house to break into for the keys. So the owners of some cars get charged extra for keeping it on a driveway, whilst others get a discount.

The stats available to insurers is incredibly detailed. The fact that some insurers charge more for some risks due to the driver having a non fault claim is proof that in some circumstances it represents a higher risk.

"The fact that some insurers charge more for some risks due to the driver having a non fault claim is proof that in some circumstances it represents a higher risk."

That is the very definition of begging the question. "I am, therefore I am."

I'm not saying insurers don't no it, I'm saying there is no probabilistic reason for doing so.

A car that is crashed into whilst parked has absolutely no basis for being a higher risk - as I said (or asked, and didn't receive an answer) before, there is no proximate cause. You could park your car anywhere and there is no way of knowing if a risky muppet is driving past; there is no basis for that risky muppet being more likely to crash into a car that has previously been subjected to a non-fault accident than one that hasn't - the risk is present due to the risky muppet, not the previous non-fault crash history of a parked car.

[V8forweekends]

gottans said:

Wouldn't the the increased renewal be classed as an unisured loss relating to the accident?

Good idea - OP sue the woman for the extra costs.

[croyde]

Similar happened to me except I didn't involve my insurance company and did all the chasing of the other driver's insurance company myself.

My premium still went up. Same reason as I was seen as more of a risk.

[TwigtheWonderkid]

xRIEx said:

TwigtheWonderkid said:

xRIEx said:

And that (highlighted) would be correlation not causation.

What would be the proximate cause for this observation? Do you even know if such data that demonstrates this exists, or are you just assuming it does? If you have the stats I'd be interested to see them.

If it didn't exist, why would insurers charge extra? It's a competitive market, so if there was no extra risk, some insurers wouldn't charge to clean up on the business.

The stats insurers have can now be broken down within different sectors thanks to enhanced technology, so an insurer my charge extra for a non fault claim for certain age groups, but not for others. Or extra for a non fault claim if you live in a city, but not if you live in the country.

On the face of it, keeping your car on the drive is a lower risk than keeping it on the road. But if you drive a car that can only be stolen with the keys, the drive becomes a higher risk as the thief knows which house to break into for the keys. So the owners of some cars get charged extra for keeping it on a driveway, whilst others get a discount.

The stats available to insurers is incredibly detailed. The fact that some insurers charge more for some risks due to the driver having a non fault claim is proof that in some circumstances it represents a higher risk.

"The fact that some insurers charge more for some risks due to the driver having a non fault claim is proof that in some circumstances it represents a higher risk."

That is the very definition of begging the question. "I am, therefore I am."

I'm not saying insurers don't no it, I'm saying there is no probabilistic reason for doing so.

A car that is crashed into whilst parked has absolutely no basis for being a higher risk - as I said (or asked, and didn't receive an answer) before, there is no proximate cause. You could park your car anywhere and there is no way of knowing if a risky muppet is driving past; there is no basis for that risky muppet being more likely to crash into a car that has previously been subjected to a non-fault accident than one that hasn't - the risk is present due to the risky muppet, not the previous non-fault crash history of a parked car.

Twin brothers, both have the same car and the same job. They share a house and have similar lives, except one of them has fallen out with his mum. The other is close to his mum and visits every week. She lives on a bend in a narrow road, and has had her garden wall hit by cars loads of times. When visiting her, his car is hit whilst parked. Fortunately the culprit is honest and leaves a note. Non fault accident.

Of the 2 brothers, who do you think is at a higher risk of having their car hit whilst parked by an unknown third party in the future?

[xRIEx]

TwigtheWonderkid said:

Twin brothers, both have the same car and the same job. They share a house and have similar lives, except one of them has fallen out with his mum. The other is close to his mum and visits every week. She lives on a bend in a narrow road, and has had her garden wall hit by cars loads of times. When visiting her, his car is hit whilst parked. Fortunately the culprit is honest and leaves a note. Non fault accident.

Of the 2 brothers, who do you think is at a higher risk of having their car hit whilst parked by an unknown third party in the future?

Now you're contradicting yourself - you said above (rightly) that actuaries use large amounts of data to generate risk models, not individual cases; you're now trying to illustrate your point via an individual example which an insurer will gather almost no information about.

TwigtheWonderkid said:

both have the same car

Known to insurer

TwigtheWonderkid said:

and the same job.

Known to insurer

TwigtheWonderkid said:

They share a house

Known to insurer

TwigtheWonderkid said:

and have similar lives,

Vague - some maybe known, some may not

TwigtheWonderkid said:

except one of them has fallen out with his mum.

Not known to insurer

TwigtheWonderkid said:

The other is close to his mum and visits every week.

Not known to insurer

TwigtheWonderkid said:

She lives on a bend in a narrow road,

Not known to insurer

TwigtheWonderkid said:

and has had her garden wall hit by cars loads of times.

Not known to insurer

TwigtheWonderkid said:

When visiting her, his car is hit whilst parked. Fortunately the culprit is honest and leaves a note. Non fault accident.

Known to insurer

TwigtheWonderkid said:

Of the 2 brothers, who do you think is at a higher risk of having their car hit whilst parked by an unknown third party in the future?

I have extra information that the insurer would not have. Let's do the same exercise using only the information provided to the insurer:
both have the same car
and the same job.
They share a house
When visiting her, his car is hit whilst parked. Fortunately the culprit is honest and leaves a note. Non fault accident.

[TwigtheWonderkid]

I am not contradicting myself at all. I said they base it on all their customers. So 1000 people have a non fault claim, some will be completely random events, and some will be an indication of increased future risk. They don't know who is who, but as a group they have a higher risk than the group with no claims at all, because of cases like the twin brothers within the group.

It really isn't difficult to grasp. You're absolutely determined not to accept it which is up to you. Carty on believing you're right, and the entire insurance industry with all their data is wrong.

[swisstoni]

Ultimately it's a fantastic reason to whack up the premium and they will be aware that inertia means that a fair proportion of customers will simply take it on the chin.

[xRIEx]

TwigtheWonderkid said:

So 1000 people have a non fault claim, some will be completely random events, and some will be an indication of increased future risk. They don't know who is who, but as a group they have a higher risk than the group with no claims at all, because of cases like the twin brothers within the group.

Unless you have the accident statistics, this is nothing more than your supposition.

TwigtheWonderkid said:

It really isn't difficult to grasp. You're absolutely determined not to accept it which is up to you. Carty on believing you're right, and the entire insurance industry with all their data is wrong.

I'm not saying the companies aren't doing it, I'm saying the reasons for them doing (if they are) are not clear. If you want to give me a categoric reason as to why probability is affected (an argument that "the data must show it" is not empirical, unless you can also provide the data) then I will absolutely embrace it. I am an evidence-based person not some bull-headed religionite; give me the evidence and I will understand.

The statements you've made have said nothing other than, "if the insurers are doing it, it is because the data says it."

I'm not saying the entire insurance industry is wrong, because there is no indication that the entire insurance industry is doing it.

I am part of that industry myself as I've said, and I'm often the first one to defend it when someone complains about something that they would have known if they'd read their policy documents, however the insurance industry is not perfect: dual pricing, new business-led revenue models, contradictory practices.

One of the principles of insurance is that one should not gain betterment through an act of breaking the law, however loss of licence cover sometimes provides exactly that - get caught speeding enough times and you can get taxied around the place. You can get over £15k per year for getting disqualified from driving. This seems to be in breach of what the CII teaches in its courses so I asked my colleagues of the time why this was the case but no one could give me an answer (and some of these people had over 40 years experience in insurance, plus one as a magistrate - they know all the boring laws and regulations). Obviously it is acceptable otherwise it would have been shut down in this last decade of stringent regulation, but that doesn't mean I understand why it doesn't breach what is set down as a fundamental principle of insurable and uninsurable risks.