Beware Esure Fees!

Angiemax1

Just a quick warning! Esure seem to be doing well when it comes to comparison sites - just beware their fees for any amendments (changes to your policy!) Below is as per their standard policy schedule.

eg: any change to your policy, (where there is no actual increase in risk) address, name, £25.50!
When there is a refund (eg smaller car, older car - they'll deduct - £25.50 !
Where there is a change to your policy which makes the premium more expensive, you'll pay the increased premium plus - £25.50 !
If you cancel during your first year - they'll deduct £52.00! (yes £52.00)

Even if you move half a mile away from your current address - you'll pay - yes - £25.50!

So bascially you must beware, I worked in motor insurance for 13 years and these fees seem to be way above what they should be. I've written to the FSA about the matter. Banks have been told - Insurers must be told too!
Esure are the Ryanair of the Insurance world. Cheap, just don't change or add anything or they'll get you!:eek:

dunstonh

So bascially you must beware, I worked in motor insurance for 13 years and these fees seem to be way above what they should be.

They are consistent with the average.

I've written to the FSA about the matter.

Waste of time. The FOS generally consider charges up to £50 as acceptable.

Banks have been told - Insurers must be told too!

Tell them what? Lower your admin charges but increase your premiums to cover it so everyone pays instead of just those creating the extra admin?

Esure are the Ryanair of the Insurance world. Cheap, just don't change or add anything or they'll get you!

Which is closer to the model that the Govt and the FSA are looking for. Yet you want the opposite.

Angiemax1

Hi there,

The opposite? - No, however a fairer system. These are not changes to mortgages or life policies, or indeed any other complex long term financial policy - these are changes to simple everyday car insurance policies.

Would you equate 20% (this would be my example)of your annual premium as a fair admin fee when there is no change in risk - provide an example where this occurs in the financial world - I'm sure it doesn't.

With the dawn of 100% interactive online car insurers, where policy amendments can be carried out online, will there be a charge for us to reprint our documents at home? Where will the admin fees come from then - perhaps we'll go back to actual underwriting again, where the premium simply reflects the risk.

You can't provide premiums that are based on the hope that amendment fees will subsidise the actual premium, this goes against the principles of insurance calculation.

dunstonh

Would you equate 20% (this would be my example)of your annual premium as a fair admin fee when there is no change in risk

The size against your premium doesnt matter. To a young driver it could be 1%. The fact is they publish a set of fixed charges to cover an admin event. Age, risk etc doesnt have any impact on it.

Whilst the transaction itself may not cost much in processing, there is still the costs of staff, buildings, computers, IT staff, supervisors, managers etc that needs to be in place. Now the choice to the insurer is to either factor it into the premiums and everyone pays or only charge those that use the service. The bundled in charge may be cheaper to those making amendments but its more expensive to those that dont and those that dont outnumber those that do.

provide an example where this occurs in the financial world - I'm sure it doesn't.

Any transaction that is fee based. The FSA are pushing for this. Indeed, I know a firm near me that has recently had to refund some money because they factored servicing costs into the contract and the FSA wanted them outside of the contract and charged explicitly on by those that used the service.

Angiemax1

Having a fee based contract no longer provides in my view license to apply fees that cannot be quantified.

99% of service providers factor in all the costs referred to in your last post and yet simply acknowledge for example a change of address at no charge. Granted, these are not fee bearing contracts however the fact that the insurer is part of the financial community does not make it exempt from giving the customer the best possible deal.

Insurance premiums are still calculated on risk, the factors mentioned are incorporated into these premiums. The fees must be quantified and justified.

Technology, fortunately will soon filter those of whom we should be wary of dealing with in the car insurance industry.

pborojon

Angiemax1 wrote: »

Having a fee based contract no longer provides in my view license to apply fees that cannot be quantified.

99% of service providers factor in all the costs referred to in your last post and yet simply acknowledge for example a change of address at no charge. Granted, these are not fee bearing contracts however the fact that the insurer is part of the financial community does not make it exempt from giving the customer the best possible deal.

Insurance premiums are still calculated on risk, the factors mentioned are incorporated into these premiums. The fees must be quantified and justified.

Technology, fortunately will soon filter those of whom we should be wary of dealing with in the car insurance industry.

There are a number of brokers and insurers around that do not charge admin fees, people obviously base their insurance needs on more than paying the odd admin fee otherwise these companies would have a very large market share?........

Angiemax1

With my experience in the motor insurance industry I can tell you that people always underestimate how many changes to their policy they make, and how unattended, these fees can add up. I congratulate those brokers and insurers that can offer competitive rates and a good service without ripping customers off. They should be flagged on comparison sites - They are like gold dust!

A charge with the "FEE Companies" for example will be made for, a name change, (even if you get married) an additional driver (even if they're older than the policyholder, or just temporarily added) a change of vehicle, a change of address, a change of number plate, cancellation, removal of a driver, a change of use, a modification, transfer to a lower group vehicle, reprint of certificate, duplicate schedule request, and lots more. These fees are added to any "actual" increase in premium due because of the change! For example if you changed your car, and the actual difference in premium was £7.50, you will be charged £33.00! - Tell me that's good customer service! The trouble is that they have you either way; you cancel - they take £52.00 upwards as a fee before refunding the unexpired proportion!

If you are 100% not likely to move or change your car or any of the above during your period of cover (and lots more) then you should be ok. If you're not 100% sure then if there's an alternative company that is not a "Fee Company" then I would recommend a closer look.

Quentin

Your mistake is in assuming a company providing complimentary admin changes is a better one than one charging for such changes.

At the end of the day, the admin has to be paid for. You can go the ryanair route, and only have to pay if you want the service, or the "traditional way" and have it included in everyone's premiums.

But which is the fairer? Why should someone who never contacts their insurer subsidise another who does need to make changes?

The moneysaving answer decide whether or not you are likely to need admin changes, and compare the premiums of those that include them and those that do not.

Angiemax1

Quite right, of course premium differential must play a part in your decision.

My question is: How easy is it on comparison sites before you commit yourself to know what the fees (if any) there will be?

"But which is the fairer? Why should someone who never contacts their insurer subsidise another who does need to make changes"

Also, on the "subsidise" side of it. Insurance is all about subsidy, spreading the risk, so whether or not you make changes to your policy, you will not make a difference to the annual rate increase your insurer makes.

These rates increase through overall claims experience of the company over the year (and previous years) as a whole.

lisyloo

How easy is it on comparison sites before you commit yourself to know what the fees (if any) there will be?

There is a site called matthews guide (.co.uk) which contains some of this information.
No connection, but probably quicker than looking up every company indvidually.

Insurance is all about subsidy

Some of it is.
Personally I prefer the "Ryanair" model.
If i keep my address, husband and car then why should I subsidise less "stable" people.
If they want to change, why do they expect me to pay??

In the airline industry, it's the same argument as charging those with bags for baggage handling rather than everyone sudsidising it.

Of course there is a difference between agreement to the principle and agreeing the charges are reasonable.

The big problem here is that lots of people who come her to complain, get the cheapest policy they can, then complain about excesses, charges, service etc.

It's a bit like buying a Ryanair ticket for 1p and then complaining there's not a fleet of spare aircraft on standby when your plane breaks down (and there was some of that when cheap airlines first came in).

As always there is a general rule of "You get what you pay for".
A lot of people complaining on here, buy cheap products and then complain about quality.
Similarly they buy direct to save money and then complain when they get no advice.

You simply can't have your cake and eat it.

Angiemax1

You should be able to safely buy online direct, and be given clear concise literature (even before you buy, online) not just on the obvious, like excesses etc

You get what you pay for, remains to a degree true. But there are always good value items at great prices. This phrase is over used and this is like branding people "rather stupid" for buying what appeared to be a bargain.

Often this is indeed the case through clever misleading advertising designed to fool some us in to thinking something exists which does not. Is this a consumer issue or a company issue - I think the responsibility is with the latter.