Insurance Renewal Fees

Weejonnie, did you know that the word "gullible" isn't in the Oxford English Dictionary?

dunstonh wrote: »

MSE Tony, the article is a mistake and a misunderstanding by MSE.

You are mixing up brokers with insurers. The move to fees is an ever increasing move to explicit charging where the cost of the supply of the product is taken out of the premium (and reduced or even no commission) but charged explicitly by the broker. This should be welcomed and other consumer groups have said they prefer explicit charging as it removes the potential for commission bias in supply. It also lets the individual know the explicit cost of that "retailer" and not have it hidden as an undisclosed commission within the premium. So, why does MSE have a different view to other consumer groups?

I've heard of a news on upfront payment to financial advisors for investment and pension, but I feel it's a bit strange to hear this is expanding to all sorts of brokers and consumer groups are cheering for that.

It would not be a big issue if those brokers reduced the premium by separating their 'advice' fee thus the total is the same, but I doubt it...

Do comparison sites display the total price including the fee?

It would not be a big issue if those brokers reduced the premium by separating their 'advice' fee thus the total is the same, but I doubt it...

That is what is happening. The commission is being squeezed.

dunstonh wrote: »

That is what is happening. The commission is being squeezed.

Why is it then that only handful of small brokers are doing this and most major ones are not?

Looked at their websites, they seem to charge the same amount as a set-up fee for a new policy as well
(so it's not insurers but brokers, not renewals only, the article was totally incorrect).

If it's compulsary shouldn't it be included in the price they quote? I don't know if comparison sites calculate this in their results but if not it's a total mess!
Sorry I don't know the inside structure of the industry but cannot help suspecting that those small brokers just want to make their quote look cheaper to be on the top of the results page.

It's the same as Ryanair, ticket sellers, etc who charge compulsary fees at the end of the transaction. I thought the current trend was to include all those compulsary charges, rather than separating them???

We're not asking brokers to recommend one of their products, but pin pointing a product and asking for a quote. Therefore not biased by the amount of commission they get.

Strange to hear they are on the current government move, I think they're actually against it like Ryanair...

BertTheRaccoon wrote: »

do you foresee the LEI gravy train drying up a bit if BTE providers have to actually start paying legal costs, resulting in the wholesale costs going up from 50p/ unit?

LEI has always been a nice little earner to make up for lousy commissions on the actual motor policy hasn't it?

Most of the brokers I know moved out of motor a long time ago or just offer it as accomadation business.

It's so labour intensive for small returns.