No claim made for car incident but premium still increased

raskazz

JonBoy_SCFC wrote: »

different companies charge different admin fees. what's wrong with a company charging £10 admin fee for Jan policies, £20 for Feb policies. no copmpliance issue there - just changing your admin fee like most companies do every now and then anyway

JonBoy, please stop being so disingenuous. My point, which am fairly sure you must have realised, is that charging someone with a BMW a £20 admin fee whilst charging someone with a Nissan Sunny a £10 admin fee would never be allowed.

JonBoy_SCFC

raskazz wrote: »

Doesn't happen. As long as the experience falls within the pre-determined frequency and severity limits then the ratings are the same. If personal injury has been occasioned which merits any change from standard terms it will be be reflected in a higher cost which will then be picked up on and sent to an underwriter for consideration. You will have noticed that a lot of insurers now specifically ask whether a claim involved personal injury at new business anyway.

you can't say that it doesn't happen because there are companies out there that you haven't worked for you know. You can say that you think it doesn't happen if you'd like to change that

raskazz

JonBoy_SCFC wrote: »

i am suggesting that a £2000 customer will be "willing to pay" a higher percentage amount (as well as a higher pound amount)

Really. Do you have any evidence for this assertion?

JonBoy_SCFC wrote: »

you should really be able to understand that price elasticity in percentage terms will change according to opriginal premium size?

I can certainly understand it JonBoy. That's why I know it doesn't actually happen.

JonBoy_SCFC

raskazz wrote: »

JonBoy, please stop being so disingenuous. My point, which am fairly sure you must have realised, is that charging someone with a BMW a £20 admin fee whilst charging someone with a Nissan Sunny a £10 admin fee would never be allowed.

no i genuinely didn't realise that was your point - i thought you were saying a test would not be allowed.

but what you say is exactly my point!!! because it's not allowed as a permanent thing going forward, but because it makes sense financially, what's to stop insurers charging the extra in the form of a higher premium increase?

are you acknowledging that it could be commercially a sensible thing to do?

JonBoy_SCFC

raskazz wrote: »

Really. Do you have any evidence for this assertion?

I can certainly understand it JonBoy. That's why I know it doesn't actually happen.

don't have evidence, but do you have evidence that it doesn't happen?

To me it seems sensible that some customers (e.g. wealthy ones) are less price sensitive to mid-term charges than others. ie.e. welathy customers are less bothered about paying the mid-term charge because they can easily afford it. common sense is it not?

raskazz

JonBoy_SCFC wrote: »

you can't say that it doesn't happen because there are companies out there that you haven't worked for you know. You can say that you think it doesn't happen if you'd like to change that

You are clutching at straws.

I have worked for broker with delegated underwriting authority and three major insurers on literally 100's of schemes. I know a lot of people in the industry. Neither me nor my acquaintances know of a single underwriting scheme that operates in the way that you propose. I have also explained why it doesn't happen. I might be wrong, but I'm fairly certain that I'm not, unless you could maybe ask your (imaginary?) actuary friend to contribute? And again, where's nothing that I can say to persuade you that you're wrong, in which case we might as well leave it here, hadn't we, as we seem to be moving in ever-decreasing circles.

As you say, it could happen that an insurer will rate a PI claim differently at renewal than it does for new business - but, as I have explained, that would only be because there wouldn't have been a new business rate for the same risk because it fell outside of set criteria.

raskazz

JonBoy_SCFC wrote: »

don't have evidence, but do you have evidence that it doesn't happen?

JonBoy - you might want to google necessitas probandi incumbit ei qui agit. This is ridiculous.

raskazz

JonBoy_SCFC wrote: »

To me it seems sensible that some customers (e.g. wealthy ones) are less price sensitive to mid-term charges than others. ie.e. welathy customers are less bothered about paying the mid-term charge because they can easily afford it. common sense is it not?

It holds some theoretic interest JonBoy, but it doesn't logically follow that it is either practical or economical for insurers to exploit it, or that they actually do exploit it. There are many things which are possible, that doesn't mean that they happen.

JonBoy_SCFC

JB: do you really think the rate loadings for every rate variable is the same for renewals as it is for new business?????
Raskazz: I don't think JonBoy - I know because it is my job.

raskazz wrote: »

As you say, it could happen that an insurer will rate a PI claim differently at renewal than it does for new business

changing your story.

JonBoy_SCFC

raskazz wrote: »

It holds some theoretic interest JonBoy, but it doesn't logically follow that it is either practical or economical for insurers to exploit it, or that they actually do exploit it. There are many things which are possible, that doesn't mean that they happen.

i agree, but neither does it mean that it doesn't happen

my experience of insurers is that they do what is commercially best for them. this would be a good reason for backing my suspicion that it does happen. as other posters have said, they are companies who's main aim is to maximise profits, not charities after all.