Vehicle insurance is a con

[Herr Tubthumper]

Justifying how and why insurance companies are conning people out of money through their legal loopholes doesnt really cut it with me. And as for they only make money on average 1 year out of 7 - it sounds like bullshit to me but even if true it doesnt change anything.

Unlike Balders who seems to agree that the industry is screwed, you seem to be actively defending it through some mis-guided loyalty.

I am not having a pop at you or anyone personally here who works in the industry or otherwise, it is the ethos, industry practice, morals & ethics I despise.

This

 

[father_and_son]

Always get a quote from your existing insurer as a new customer enquiry, then you'll get an idea of what they should actually be quoting you for renewal. Useful ammo to have. My existing insurer was cheapest at renewal on a comparison site, so I 'switched' to the same insurer and saved about 20% !!!

There is one small downside... most insurers (if you go direct) won't charge a cancellation fee in the second and subsequent years (or lower it quite considerably). If you "churn" your policy, they will always see you as a first-year customer and you will be subject to first-year fees (which are used to cover acquisition costs - eg paying the price comparison site, sending you a policy document, etc). Not a problem if you have no intention of ever cancelling mid-term but you won't be able to complain if they did enforce the fees if you did cancel.

Brokers are slightly different in that they normally charge the same fees regardless of how long you have been with them or the insurer - they have a different operating model and do nearly as much work at renewal as they did at new business.

 

[father_and_son]

That would be very true in the good old days when Underwriters actually underwrote business and Actuaries were listened to. Unfortunately these days, and it's just my humble opinion based on experience, that most Insurance businesses are now run by the Marketing Dept and the Finance Dept who wouldn't know what an Underwriter or an Actuary was ;-)

I'd actually say its a combination of the Finance Director and the HR Director. The cost of maintaining a call centre means you need a certain level of turnover or you just can't function with the fixed costs you face but you can't close the call centre because you'd need to pay off the staff with redundancy. Its better to sell 100,000 policies and lose a £1 on each than sell 1,000 and make £10 on each and they more than make back the lost £1s selling Home, Travel and Pet insurance (which all pretty consistently make a profit) to the wider customer base they access to.

Not every company works to this model, some can do things on a shoestring but will never be able to play with the big boys using the model they have. I've seen many small insurers try to expand and just implode as soon as the maths doesn't add up.

 

[Prettyboyshaw]

Try using small local brokers with no ties to any Insurers they should just re broke you to the cheapest available (the difference in commission keeping you with a more expensive Insurers is so little its not worth losing a client), help with claims and take the hassle out for you...if you can find a good one

 

[Cian]

Every privately held insurer I've ever been with has done the hike-and-reduce-when-asked renewal system; one of them went bust and was bought by a US mutual (Liberty) and since changing to them my renewal quotes have actually gone down slightly each year. I'll change motor insurer for €20 of a difference because the paperwork involved is usually just emailing a scan of the NCB certificate - all but a few don't look for licences.

However I'm trying to figure out if the incredible hassle of getting an NCB cert for my house insurance, changing the assignment for the mortgage etc is actually worth it for €100 - or €50 or less as it'll drop to the instant I tell RSA I'm looking to leave.

 

[Prettyboyshaw]

I think Direct Line started the trend of buying in business then hiking up premiums but keeping their original intended quota of new clients. They say wanted 100,000 new policyholders set rates to low they got in 300,000 then next year ramp up the prices and lose 200,000 but keep their original target of 100,000.

All these large companies will treat you like a number just find companies without call centers that treat you like a person.

 

[doogie004]

Go through these games every year as a taxi driver its expensive wot u have to do is phone around then phone them back and they beat the claim . The first price u receive is done by machine or wot ever once they have gone over nothing's changed normally get cheaper if £1200 per car is cheaper lol

 

[CheeseRolls]

There are still some breathtakingly stupid practices in motor insurance. The answer is more European style legislation to sort out the Free market sharp practices.

One great example is car hire. You are involved in an accident, the other party admits fault and pays for a hire car, whilst your car is being repaired. Your insurer then charges £150 per day for a hire car, which given their business size and scale they could probably get for nearer £15 per day. Of course they don't do this, because a high hire charge, hurts the competition, who are footing the bill. Of course EVERY single insurer, follows this course of action, so the net result is we ALL pay higher premiums.

Does big business want more scrutiny and red tape here ? You bet they don't ! Do I as a CONSUMER want more red tape interfering with the free market, too bloody right I do. You can make your own minds up about the Nanny state.

 

[father_and_son]

Justifying how and why insurance companies are conning people out of money through their legal loopholes doesnt really cut it with me. And as for they only make money on average 1 year out of 7 - it sounds like bullshit to me but even if true it doesnt change anything.

Unlike Balders who seems to agree that the industry is screwed, you seem to be actively defending it through some mis-guided loyalty.

I am not having a pop at you or anyone personally here who works in the industry or otherwise, it is the ethos, industry practice, morals & ethics I despise.

As someone who's been at the cutting edge of pricing, underwriting and product development for a number of years, I'm not only loyal, I'm very proud of the parts of the industry I'm been involved with.

Until recently I was at the sharp end of "black box" insurance, working with academics, road safety experts, the police and even driving schools developing products for new drivers that reward safe driving and make the costs of insuring a car for 17/18yo far more affordable.

I have personally used the technology to decline claims that would have been paid by proving undeniably the customer lied. I have also authorised paying claims including one that would have gone to a fraud investigation and probably not been paid had we not been able to confirm the driver's rather far-fetched car-jacking story.

No industry that has to sell you something is whiter-than-white. Very few people have to sell you something that you are required by law to buy. That's a tough market place to work in. I have said above there are aspects of what happens I personally don't think are in anyone's long term interests (but then I'm not on a share incentive scheme trying to make money this year and sod the future), but in the end I would defend the industry against all unfounded criticism especially that suggesting the people who work in the industry are "sub human scum" and I don't believe any of that to be mis-guided.

In 20 years in this industry I have only ever seen two claims refuted that I felt was completely unfair (and only one was a motor claim). But in that time, I have had dozens of conversations with people who will openly admit to strangers in the pub how they are ripping off their insurer to save (or make) a few quid. I've seen uninsured drivers crippling people, fraud rings, staged accidents, certificate farming, ghost brokers and just about every other form of organised fraud. A whole host of people far more deserving of the tag of "sub human scum". Then add in untold amounts of misrepresentation, exaggeration and falsified documents from people doing it for just themselves and it all amounts to a whole host of distrust and antipathy.

 

[AmexRuislip]

He's not though. They almost always will, it's just that they expect you to make the effort to get them to that point.

I had a policy with Hastings Direct one year. Got the renewal notice though, sure enough it had gone up, despite no claims or issues. I rang them, asked if that was the best they could do, they said "yep, that's yer lot". I shopped around, found another company and got a quote, then rang Hastings back to ask if they could match it. They offered to knock twenty quid or so off, still leaving the other quote about sixty quid cheaper, so I told them thanks but no thanks, and then went and took out the other policy.

I rang Hastings back to confirm cancellation of the old policy, at which point- SURPRISE!- they announced that, miraculously, they could beat the other company's quote. Equally as mysteriously, it turned out the other company was a subsidiary of Hastings Direct. I told them I'd already taken out the new policy, to which they advised me to cancel it and go with Hastings. I asked if they could do it themselves, given that this other company was effectively part of theirs, but they said they couldn't do that. Then they offered to drop the price even more. Cocks.

The hassle involved in doing this, even with a 14 day cancellation period, did my head in, so I ended up telling Hastings to shove it up their arses and just stuck with the new one. That's the massive irritant with it all: that they could quite easily give you a reasonable quote early on, but they don't, even when you're the one doing the running around. Didn't stop them bombarding me with junk mail for years afterwards either, urging me to consider them for every other type of insurance on the planet.

Do what I do when I get a load of a companies junk mail, put it all in a large envelope addressed to them ( no stamp, mind you ), they do get it & have to deal with
I think Hastings Direct are based in Bexhill, along Cooden or Collington Avenue.