INSURANCE Renewals
Discussion
For the first time ever in over 10 years both my car and van insurance renewals £240/£235 respectively didn't go up.
Normally When you get the renewal notification the premium rockets and you have to search for a better deal. In general the insurance companies usually give discounts to new customers.
This year I couldn't find a better deal.
Are insurance companies now trying to retain more customers?
Normally When you get the renewal notification the premium rockets and you have to search for a better deal. In general the insurance companies usually give discounts to new customers.
This year I couldn't find a better deal.
Are insurance companies now trying to retain more customers?
ABI/BIBA have now got guidelines that for those taking part is that renewals essentially should be a similar price to a new customer. Many insurers are part of these industry bodies so probably will be doing something along those lines now.
The FCA are also investigating the practice regarding renewals being vastly more expensive than new customers, which has probably if I am honest driven the release of the guidelines from the above bodies, which in turn is probably more of the reason why many are changing their practice regarding renewals v new customers to avoid more flack.
In reality what is actually happening (and confirmed definitely by one insurer I know) is that new customers are getting more ripped off than ever as instead of discounting rates to lower premiums to that of new customers for current customers at renewals, they are in fact simply raising the cost of new customer policies.
In some cases this has taken the form of actual price increases, but in many cases what insurers are doing is making it more dirty and less clear such as reducing discounts online for new customers (which is what the insurer I know has done by halving new customer discount, used to be 10% on older terms but is now only 5%) or providing different APR finance rates for new v current customers (5% higher for new customers). Others have increased discounts for other products they sell as well to make them look more reasonable and be quote "acting" on the issue (which in more Insurance industry speak is "dual pricing").
Furthermore, in some cases new customers are getting hit with more restrictive T & C's than current customers. Some of them will be getting newer bits granted, but somewhere along the line they will loose out more than the new customers. Solely focusing on price as a decider is a poor way of choosing a policy IMO, you really need to compare the policy as much as possible in terms of cover offered for that cost.
As well as many today bringing more "hidden" charges which are generally less clear at sign up (for instance charging for using your own repairer which seems at least in my experience to now be spreading further in the industry (Aviva started this just under a decade ago, but it appears a few others like LV= now do for new customers...be aware).
The FCA are also investigating the practice regarding renewals being vastly more expensive than new customers, which has probably if I am honest driven the release of the guidelines from the above bodies, which in turn is probably more of the reason why many are changing their practice regarding renewals v new customers to avoid more flack.
In reality what is actually happening (and confirmed definitely by one insurer I know) is that new customers are getting more ripped off than ever as instead of discounting rates to lower premiums to that of new customers for current customers at renewals, they are in fact simply raising the cost of new customer policies.
In some cases this has taken the form of actual price increases, but in many cases what insurers are doing is making it more dirty and less clear such as reducing discounts online for new customers (which is what the insurer I know has done by halving new customer discount, used to be 10% on older terms but is now only 5%) or providing different APR finance rates for new v current customers (5% higher for new customers). Others have increased discounts for other products they sell as well to make them look more reasonable and be quote "acting" on the issue (which in more Insurance industry speak is "dual pricing").
Furthermore, in some cases new customers are getting hit with more restrictive T & C's than current customers. Some of them will be getting newer bits granted, but somewhere along the line they will loose out more than the new customers. Solely focusing on price as a decider is a poor way of choosing a policy IMO, you really need to compare the policy as much as possible in terms of cover offered for that cost.
As well as many today bringing more "hidden" charges which are generally less clear at sign up (for instance charging for using your own repairer which seems at least in my experience to now be spreading further in the industry (Aviva started this just under a decade ago, but it appears a few others like LV= now do for new customers...be aware).
Edited by Ninja59 on Saturday 29th December 18:08
Edited by Ninja59 on Saturday 29th December 18:09
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