No claim made for car incident but premium still increased

pedro123456

This to me shows you can't necessarily believe the reasons insurers give you for the premiums they charge.


Z

JonBoy_SCFC

Dan_Thomas wrote: »

They don't build a price structure on "willingness to pay".

i'm afraid it's you that doesn't understand:rotfl::rotfl::rotfl:

Obviously measuring the claims risk is a big chunk of the price calculation process, but the bit i've quoted above is complete nonsense and i challenge any of the board regulars who work in the industry to back you up on the quote above. They won't though, obviously.

lisyloo

They don't build a price structure on "willingness to pay".

A lot of businesses do make a higher margin on services ONCE you are committed.
For instance I have a boiler put in by the builders.
The up front price of the boiler is cheap (to appeal to builders).
The on-going parts are ewxpensive but the builder doesn't care.
Now I can't cheaply change my boiler so I'm committed.

You can cancel and change your insurance but it usually costs you money in pro-rating and the admin fees, so it comes at a cost, therefore you are committed to come degree.

ALL businesses need to make money and it's a common technique to get people in cheap and charge them more on ongoing services.
This isn't a secret and it's not immoral and it's not criminal.

I think people have to stop expecting insurers to act like a charity.
They are a business run for profit and will use sales and pricing structures accordingly LIKE many other businesses do.
Don't make them the spawn of the devil.
It's capitalism.

I'm not saying everything is wonderful in the garden.
Mu OH is unhappy with Tescos because they have not indicated what he needs to do with his policy if he doesn't want it auto-renewed.
They have not been transparent and have been obstructive with the information.
I don't think they are all wonderful, but people have to realise they are profit making businesses and this is capitalism not some ideal fairly land world that people would like it to be.

JonBoy_SCFC

agreed, but there's a way of conducting yourself within the capitalsm world we live in.

i wouldn't object so much if they were more open about it - why is it when you call an insurer at renewal and ask them if they are giving you the best price they possibly can, they promise you that they are doing this. Only to find out exactly the same thing can actually be £400 cheaper 10 minutes later?????


Also, it wouldn't feel as sneaky if they didn't bang on about "treating customers fairly" so much. The FSA make a big fuss of this, yet for the matter that concerns customers the most, they are nowhere to be seen!!!!

castle96

slightly off topic.
just noticed on my household renewal, that the ncb (buildings) was reduced from 9 yrs to 1 due to a 'claim' last yr. I did claim, an assessor came, and apparently this cost AXA £105. They deemed this to be a 'calim', even though they did not pay out (claim refused). When I argued they agreed it was an error and reinstated the ncb.

lisyloo

Does anyone know if there are any links on the FSA sites about being charged more after a non-fault claim?

lisyloo

agreed, but there's a way of conducting yourself within the capitalsm world we live in

Yep totally agree with you there.
They are not very transparent about aut-renewal.
I've found it difficult to check on several policies and it should be a KEY FACT.
They don't make information clear when it's in their interests to hide it.

But we need balanced discussion about it.

dacouch

There is a very simply reason Insurers have an admin charge on mid term adjustments, they quote a price of say £200 for the car insurance for a year which assumes you will not need to change address etc. Out of that £200 they will typically net around £20 (This excludes all the new customer discounts they currently give to gain customers). If a customer wants to change their policy the Insurer have to pay people to do the work so if your change of vehicle costs £50 they will make £5ish so they add the admin fee of between £10 and £25 to cover the staffs wages.

Most brokers break even on motor insurance because of the work it creates, they offer it as it gives them the chance to offer home insurance etc where they can make money and there is not lots of work involved.

If you look at say a broker who offer motor insurance only and a broker that deals in mainly commercial or household you will see they need a fraction of the staff to deal with the same amount of business as these types of business create a fraction of the work motor insurance creates.

When you go into work on Tueday Jonbiy have a look how many staff they have in customer services for the home insurance compared to the motor insurance. Ask the underwriters what their margins are on motor and on household and you will see why the they charge admin fees.

Lisyloo you can have a look on the FSA site for a ruling on it but its incredibly difficult to find anything on the FSA site. No doubt the Insurers who charge extra for a non fault claim can demonstrate their statisics show a non fault claim means you are more likely to have further claims. The other thing to remember is even a non fault claim will cost the Insurer in admin in dealing with it even if they get their costs back from the other side (Which won't include their admin)

lisyloo

The other thing to remember is even a non fault claim will cost the Insurer in admin

That wouldn't apply if you went direct to 3rd parties insurer though would it?
and you still have to declare it right? even though you never claimed off your own insurance.

dacouch

Most Insurers have a wording that asks for any "Incidents" or any "Incidents that would be covered by this policy" so its best to declare them.

Most customers will claim off their own Insurance initially and then recover their excess from the third party as its often the easiest option.