Car insurance 120% hike, no reason?

deanp_2

Hi everyone, i'm after some advice.
My insurance renewal (Esure) came through this year, and leapt from a staggering £1060 to a whopping £5700. I've made no claims, had no accidents, been involved in no incidents. I'm aware of the annual hike, and this year the average 40% hike in premiums, but this was absurd. I spoke to Esure, and was told... "it's gone up because the computer says so".
I shopped around, assuming they didn't want my business, so was horrified to find that the average policy is still sitting at £2600 average from across the board. I can get it lower to £1600 if i'm prepared to hack a £3000 compulsory excess... (I'm not)

The premium is almost a third of the value of my car. I'm in a finance agreement so I don't think I can VT the agreement until i'm half-way through, some 10 months away...

Is there likely to be any reason i'm not privy to that is behind this phenomenal hike? The insurers all say "because the computer says so" - I'm suspecting there's some data somewhere causing this, but without access to the records they use to calculate premiums, i'm at a loss...

Any guidance would be welcome, i'm slowly becoming bankrupt!

Thanks,
Dean

raskazz

Without any further information the best guess would be the part of the country in which you live being a high risk area. What is the first part of your postcode?

opinions4u

I don't really understand where the 120% figure comes from.

If you don't like the premium, take you business elsewhere.

If you can't afford the cheaper premiums elsewhere, change your car (or driving habits if there have been claims).

deanp_2

opinions4u wrote: »

I don't really understand where the 120% figure comes from.

If you don't like the premium, take you business elsewhere.

If you can't afford the cheaper premiums elsewhere, change your car (or driving habits if there have been claims).

Thanks for your rather pointless response. I think you're missing the point.
My policy has unjustifiably increased from just over £1000 to £2600... I can't warrant the risk of a £3000 compulsory excess. This is common across all insurers, so I can't do much else to get it cheaper.
The insurers seem unable to tell me exactly what part of my quote they assess as risky, so i'm unable to do a lot about it, but given there seems to be similarities, i'm assuming there has to be something "behind the scenes" they they're referring to that's causing it.

I'm trying to see if anyone else has experienced similar issues. I've already explained I can't change the car.

deanp_2

raskazz wrote: »

Without any further information the best guess would be the part of the country in which you live being a high risk area. What is the first part of your postcode?

Hi, I moved house at the same time as the renewal, but i'm not getting much luck with any. Originally L7 , Moved off to M15 at renewal (which was cheaper) - But now i'm seriously considering moving back to mums (L13) as I can't afford to live here / pay rent. If the reduction difference offsets rent, then i'll move house again. Contract is up here (M15) in May.

dunstonh

My policy has unjustifiably increased from just over £1000 to £2600... I can't warrant the risk of a £3000 compulsory excess. This is common across all insurers, so I can't do much else to get it cheaper.

Its not unjustified. What you really mean is you dont understand risk. The figures you indicate suggest you are a high risk case. Risk has become expensive.

The insurers seem unable to tell me exactly what part of my quote they assess as risky

If you are talking about the sales reps on the phone when you get quotes then they wouldnt be able to tell you. Most of them are neither qualified or experienced enough to know. If they did then they wouldnt be answering the phones. If you spoke to a local broker though they would be able to tell you.

Usually, you can tell if you are high risk or not by applying some logic. area you live in, your age, your past claims history, how many points (and what type), car you drive etc.

M15 postcode is very high risk. here is a quick and dirty guide (insurance companies use their own data but it will give you an indication) : http://www.carinsuranceexplained.com/car_insurance_explained/insurance_postcode_risk.htm

opinions4u

deanp wrote: »

Thanks for your rather pointless response.

Well the first part of the response was to try to clarify where 120% comes from. But you haven't done so.

The second and third parts of the post where a clear explanation as to what to do about the position you find yourself in.

I think you're missing the point. My policy has unjustifiably increased

A company can charge whatever it wants for a service. A customer can choose to pay it or not to pay it. In the case of Esure they got taken over last year. So one factor in your renewal may be as simple as them wanting to make more profit out of you.

I can't warrant the risk of a £3000 compulsory excess. This is common across all insurers, so I can't do much else to get it cheaper.

Which suggests changing car, or address, as the route to take.

The insurers seem unable to tell me exactly what part of my quote they assess as risky, so i'm unable to do a lot about it, but given there seems to be similarities, i'm assuming there has to be something "behind the scenes" they they're referring to that's causing it.

They won't tell you directly. Publsihing underwriting information can generate people answering questions fraudulently in order to gain cheaper cover. So don't expect this information.

I'm trying to see if anyone else has experienced similar issues. I've already explained I can't change the car.

Last Winter saw a lot of snow. Many drivers had accidents. Younger drivers were particularly poor at dealing with it. It could easily be that your type of car, your age group and your post code area were all highlighted as being particularly poor performers in frozen conditions.

M15 used to be a notorious post code for theft. I have heard that it's improved in recent years, but I would have thought car theft was still relatively common in the part of Manchester - a city with one of the highest crime rates in the country (the locals put that down to the Scousers sneaking over the border at night, but that's another story ).

While you were frustrated with my previous answer, it still stands. Even if you knew all the data behind the premiums, the only ways I can think of that you'd be able to change them is by lying, changing car or changing address.

There is absolutely no point banging your head against a brick wall trying to get information that won't change anything anyway.

jnt

Have you tried youth car insurance in essex, just insured my son for £1508 fully comp, i know its still a hike in price but his excess is only £500. Might be helpful

deanp_2

I'm still not grasping why before 11th january renewal date i was £1400 less risky than after it.
Sure, if i'd had an accident, made a claim, even moved then I could understand. Even before i'd moved house the renewal was a complete joke, (1060 to 5700).

I don't settle for the answer "the computer says so" - What is the data that the computer is using to decide i'm suddenly a higher risk.

I'm not any more of a risk in 2011 than i was in 2010. Arguable i'm less of a risk as i've got another years no claims, and another years driving experience.
Unless the insurers can explain why they think I am, in an answer better than "the computer says so" then i'm going to keep pushing for a better premium. As far as i'm concerned, it could be a simple technical error on a database that's causing this. I've had errors for the last year continually happening on my credit report affecting my rating which i would be oblivious to, only I got my report from experian. It's fixed with a quick call... I want access to this insurance data so I can make a valid assessment as to it's validity.
Surely im entitled to see what the insurers are using to assess me as a risk, in the same way i'm allowed to see my credit report from a financial perspective?

dunstonh

I'm still not grasping why before 11th january renewal date i was £1400 less risky than after it.

Maybe the company hadnt changed its rates to reflect risk price changes.

Sure, if i'd had an accident, made a claim, even moved then I could understand. Even before i'd moved house the renewal was a complete joke, (1060 to 5700).

Its not really about you though as an individual. Its about you as a statistic in a pool of similar statistics.

I'm not any more of a risk in 2011 than i was in 2010.

No. However, you were getting risk priced cheaply previously. Risk is more expensive post credit crunch. The investors dont want to take as much risk. So, the price of covering risks has gone up to entice them back to the market.

Surely im entitled to see what the insurers are using to assess me as a risk, in the same way i'm allowed to see my credit report from a financial perspective?

Its usually very easy to work out for yourself why you are higher risk. You dont need to be told it. In your case the postcode seems to be a major factor.

Esure have taken an approach where they are still pricing low risk very nicely and cherry picking that market. They dont want higher risk at lower cost and are pricing much higher for it.

You need to think of risk as carrying a price and there are investors at the other end that are risking their money to cover that risk. If those investors were not there then there would be no insurance. When there are few investors or the investors dont want much risk, the price goes up. When there are lots of investors or risk appetite is higher then the price goes down.

bouncydog1

The underwriters could have simply decided that they no longer wished to provide cover and would have advised that they were not prepared to renew your policy.

At least you have a quote - the decision as to what you do with that quote is up to you - you can either accept it or try and change your risk profile. Do you have a higher group vehicle - if so what about changing to a lower one (and yes I've read that you don't think you can but what about finding out for sure)?

The fact that other underwriters are also quoting increased terms is, as other posters have said, because the risk profile has changed over the past few months. Reinsurance is also bought by insurers on 1 January for 12 months and it is possible that the cost of the reinsurance has gone up, or underwriters have to carry more risk for their own book, which means they have to charge more so they have a big enough "pot" to pay claims.