Insurance - misleading pseudo-scams they use

Insurance - misleading pseudo-scams they use

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ImABitLongCars

Original Poster:

86 posts

124 months

Friday 26th August 2016
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So... eventually ended up getting so fed up of all this I just went through every permutation with Admiral and sticking with them.

I can get it slightly cheaper elsewhere, but for the sake of a few £100 I thought better the devil you know.

Key thing here was that *if I ran an insurance company* I would suggest/offer the best possible permutation, without the customer having to figure it out. I'd still make a good margin, but I would have super loyal customers who knew I wouldn't try and hoodwink them come renewal or additional car on the policy time.

£1500 for a 35 year old with 5 years no claims in London on an E46 M3 worth £8k.

Ouch!

No wonder there are so many uninsured drivers!


Alex_225

6,234 posts

200 months

Friday 26th August 2016
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I certainly found the multi-car policies pretty useless after the first year of having one.

I used to insure with Admiral and had two cars on separate policies. I was offered a Clio 172 at a bargain price so thought I'd extend my Twingo 133s policy to a multi-car so that the Clio was better to insure - no 3rd lot of no claims at the time.

When it came to the end of the policy I found that the renewal prices weren't any better than individual policies so I ditched the multi-car.

The one positive thing I came away with was that they'd given me the no-claims bonus on the Twingo and Clio so essentially I got 6 years worth of no claims in a year.

Esure have been good though as they offer 10% off other policies you hold so not linked other than just being a previous customer.

C70R

17,596 posts

103 months

Friday 26th August 2016
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ImABitLongCars said:
Key thing here was that *if I ran an insurance company* I would suggest/offer the best possible permutation, without the customer having to figure it out. I'd still make a good margin, but I would have super loyal customers who knew I wouldn't try and hoodwink them come renewal or additional car on the policy time.
I'm sure that most normal human-beings without knowledge of how an insurance company works would do this. However, your typical insurer is more interested in fluffing their bottom line, paying their shareholders and keeping the books looking healthy. How they do that is down to them - if customers feel like they are paying too much, it's never been easier to check or switch.

TwigtheWonderkid

43,248 posts

149 months

Friday 26th August 2016
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ImABitLongCars said:
Key thing here was that *if I ran an insurance company* I would suggest/offer the best possible permutation, without the customer having to figure it out.
Logically there should be no permutations. The client says what cover he wants, the insurer gives the price.

The problems come when customers, trying to get the best price, add on drivers who won't actually drive (nothing wrong with that) in order to reduce the premium, realise it's cheaper to keep it on the street than a drive, see that by putting "media employer" it's cheaper than putting journalist etc etc.

You can't seriously expect any business to say "this is our correct price, but if you do X, you can fk up our pricing algorithms and get it cheaper than it should be".



Max5476

978 posts

113 months

Friday 26th August 2016
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What would be the typical insurance cost if all permutations were removed and the government set a flat insurance rate?

98elise

26,378 posts

160 months

Friday 26th August 2016
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TwigtheWonderkid said:
Nemo Sum said:
TwigtheWonderkid said:
People seem to have a different interpretation to the words "rip off" and "scam" to me.

If I go to buy something, and they quote me £1000, and I can get it for £500 elsewhere, that is not a rip off or a scam. It's just one supplier's price that another supplier can better. No one is holding a gun to my head, or forcing me into anything.

If they quoted £1000, and then took £1500 from my card, and refused to refund it, that would be a rip off!

I'd disagree. If the exact same thing is 200% dearer then where you can get it elsewhere than to me, that would definitely be a rip off.

Not at all. The post office can deliver a letter next day for me from London to Inverness for about 50p (or whatever a 1st class stamp costs these days). DHL would probably charge me £50 for the same thing. But the truth is, they are each targeting a completely different segment of the delivery market.

One insurer might be after certain business, and may be competitive for that and uncompetitive for a different type of customer. It's just business. I don't know why people get so upset that they got their insurance for £500 when someone else quoted them £2K. So what, you never paid the £2K so you weren't ripped off.
I agree. You ask for a quote, they give you a price. You are not obliged to buy their service. How can that be a rip off.

If you can find it cheaper then buy that product.

ImABitLongCars

Original Poster:

86 posts

124 months

Friday 26th August 2016
quotequote all
TwigtheWonderkid said:
The problems come when customers, trying to get the best price, add on drivers who won't actually drive (nothing wrong with that) in order to reduce the premium,
I actually realised this when I added my mum to the old Ferrari 348 as a joke and she bough the premium down by £12. BOOM! IN YOUR FACE BIGCO INSURANCE FAT CATS!

Also, we should bash insurance companies to much, they make up a huge % of most of our pensions...!

vikingaero

10,256 posts

168 months

Saturday 27th August 2016
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ImABitLongCars said:
- Multicar policies seem to be a con. We have three cars. An E46 M3, as a third car barely used with a 3000 mile or less limit, 5 years no claims, 35 years old in London, was £1.5k. I can get cheaper quotes directly on the car, so do not seem to benefit at all from having other cars with them? It seems multicar is just a word to capture more business that doesn't actually have any economic benefit.
Most Insurers would give you a new business/promotional/headline discount to get your business. That's why getting quotes on renewal is cheaper because you are a new customer. Existing Insurers at renewal have given your there new business discount last year. Some multicar insurers are really good. I find that companies that overtly advertise multicar policies are poor - standard premium less 10%. My Insurer mirrored my no-claims and gave a 10% discount which was worthwhile. This still wasn't the cheapest by £24 but I wanted convenience with one Insurer and to avoid the Admiral sharks.

[quote]- "Quoting for the rest of the year so it lines up with your other policy" is another slight con. I was quoted £500 for the M3, not bad. Oh, what, you mean just until the end of January. Can you tell me how much that is annually? "We don't quote annually". Do they thinks we don't have calculators?
Any reasonable premium for short term is going to be hammered by administration costs for that policy. If it costs that Insurer £xx for a 1 day or 1 year policy then they will charge it.

[quote]- The price comparison sites direct you to their partner/affiliate businesses rather than genuinely comparing the whole market. Again, not illegal, but just misleading
You need to use all the comparison sites. Direct Line Group don't use comparison sites. Also I get quotes with and without cashback sites.


Edited by vikingaero on Saturday 27th August 09:37

The Mad Monk

10,474 posts

116 months

Saturday 27th August 2016
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ImABitLongCars said:
Hey guys

I was getting quotes for my cars this week, and I noticed something interesting. Although not directly a scam, I think some of the approaches are very misleading, to the point of being pseudo-scams.
.......

- The price comparison sites direct you to their partner/affiliate businesses rather than genuinely comparing the whole market. Again, not illegal, but just misleading

Am I on crazy pills?
This isn't my experience.

When one of the insurances is coming up for renewal, I look at one or more of the online price comparison websites - Confused, Money Supermarket, etc. There prices are all normally within a few percentage points of each other. I ignore the very cheapest, because they are usually companies I have never heard of. I seem to end up going with LV.

I haven't noticed any scams.

rohrl

8,712 posts

144 months

Saturday 27th August 2016
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Insurance premiums vary because different insurers are aiming for different customers.

This is why some people will find that Company A offers them a cheap premium while other people find that Company A is very expensive and Company B is much cheaper.

There's no point getting upset about it. Perhaps you're just too old, too young, live in the wrong postcode, do the wrong job, own the wrong car or have the wrong previous claims history to be Company A or Company B's target customer.

If you want to get the cheapest insurance your best bet (unless you're proposing a very unusual risk profile, in which case you need a specialist broker) is just to put your details through two or three online search engines every year and let the companies bid against each other for your business.

All that jazz

7,632 posts

145 months

Saturday 27th August 2016
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Protected NCB is another con. You "lose" the bonus in the increased renewal premium.

Dr Jekyll

23,820 posts

260 months

Saturday 27th August 2016
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ImABitLongCars said:
The price comparison sites direct you to their partner/affiliate businesses rather than genuinely comparing the whole market. Again, not illegal, but just misleading

Am I on crazy pills?
Which price comparison sites?

TwigtheWonderkid

43,248 posts

149 months

Saturday 27th August 2016
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All that jazz said:
Protected NCB is another con. You "lose" the bonus in the increased renewal premium.
You clearly don't understand how protected bonus works.

If you have an accident, there are 2 separate factors at work that might up your next premium. Firstly, a loading for having had an accident. Secondly, the loss of ncb. By protecting your bonus, you only get hit by one rather than both. Having protected bonus will always mean a lower premium at renewal compared to not having protected bonus. It doesn't mean the price is frozen or there won't be an increase.

All that jazz

7,632 posts

145 months

Saturday 27th August 2016
quotequote all
TwigtheWonderkid said:
All that jazz said:
Protected NCB is another con. You "lose" the bonus in the increased renewal premium.
You clearly don't understand how protected bonus works.

If you have an accident, there are 2 separate factors at work that might up your next premium. Firstly, a loading for having had an accident. Secondly, the loss of ncb. By protecting your bonus, you only get hit by one rather than both. Having protected bonus will always mean a lower premium at renewal compared to not having protected bonus. It doesn't mean the price is frozen or there won't be an increase.
I understand how it works perfectly well. The increased cost of protecting your NCB is nothing short of a con because the overall increase of your renewal premium isn't small enough to offset the extra you paid for protecting, so you end up paying more overall than you would do if you didn't protect them in the first place. If it wasn't in the insurers favour then quite simply they wouldn't offer it. It's a prime candidate for this thread as it is very much a "misleading pseudo-scam".

Brads67

3,199 posts

97 months

Saturday 27th August 2016
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They have also started capping NCD at 9 yrs

I had 30 yrs and because of that never needed protected. A claim would lose me 3 yrs and I would still have maximum NCD.

Capped at 9 means every claim results in not having maximum for another 3 yrs. s.

Protected is a SCAM you get loaded regardless. IF they can`t split your increase over 2 reasons they just up the ante using 1 reason.

Insewerance scum.

swisstoni

16,855 posts

278 months

Saturday 27th August 2016
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I do think there is room for scrutiny of the 'house rules' imposed by insurance companies. We are, after all, obliged by law to obtain insurance, yet they seemingly can change the rules as they see fit.

TwigtheWonderkid

43,248 posts

149 months

Saturday 27th August 2016
quotequote all
All that jazz said:
TwigtheWonderkid said:
All that jazz said:
Protected NCB is another con. You "lose" the bonus in the increased renewal premium.
You clearly don't understand how protected bonus works.

If you have an accident, there are 2 separate factors at work that might up your next premium. Firstly, a loading for having had an accident. Secondly, the loss of ncb. By protecting your bonus, you only get hit by one rather than both. Having protected bonus will always mean a lower premium at renewal compared to not having protected bonus. It doesn't mean the price is frozen or there won't be an increase.
I understand how it works perfectly well. The increased cost of protecting your NCB is nothing short of a con because the overall increase of your renewal premium isn't small enough to offset the extra you paid for protecting, so you end up paying more overall than you would do if you didn't protect them in the first place. If it wasn't in the insurers favour then quite simply they wouldn't offer it. It's a prime candidate for this thread as it is very much a "misleading pseudo-scam".
Most insurance policies charge about 5 about 10% to protect bonus. This is far lower that the loss of bonus if you have a claim. Insurers make it work for them because they usually only offer prot NCB on max ncb, and people have got to max ncb for a reason, because they rarely have accidents.

Mandat

3,881 posts

237 months

Saturday 27th August 2016
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Brads67 said:
They have also started capping NCD at 9 yrs

I had 30 yrs and because of that never needed protected. A claim would lose me 3 yrs and I would still have maximum NCD.
Based on previous posts from the insurance experts, you might find that you are totally incorrect.

I remember Loon saying on quite a number of different threads that the maximum years that insurers treat as actual NCB is 5 (I think), with anything over being counted as claim free years.

Consequently, with your 30 claim free years, you would still lose 2 years off the maximum 5 years NCB, leaving you with only 3 years NCB, unless you protected it.

It seems that your insurer may be treating 9 years as the maximum NCB, although I would be interested to hear how many years you would lose in the event of making a claim.

I'm sure that others, more knowledgeable, will correct me if I'm wrong.

Mr2Mike

20,143 posts

254 months

Saturday 27th August 2016
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Brads67 said:
Protected is a SCAM you get loaded regardless.
Of course it is. None of these schemes would be offered if they didn't ultimately make more money from it.

Just reading a news article that says significant savings made from restricting personal injury claims and referals (aka kickbacks) are not being passed onto the consumer. What a surprise.

Mr Snrub

24,942 posts

226 months

Saturday 27th August 2016
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ashleyman said:
My Insurance quotations blew my mind when I was searching in March.......
I feel your pain. Last year I paid £250 fully comp, then I had a non fault claim where I was hit from behind at the lights, then a windscreen claim when one of the local kids put a stone through the window. I was moving house (from a B to C risk area) and my quotation came in at £350. Well that's always a rip off so I went on all the comparison sites - the cheapest came up around the £750 mark!! This is for a 33 year old male with no points or convictions, 10 years NCD on a bog standard Rover 75