Auto renewal who has been caught out

mikey72

Well, if the posters who like auto renew are happy, good luck to them.
Keep the industry as it is.
The rest of us will keep complaining.
The AA are on form, and I am just about to report them to the FSA.
We got the renewal notice, £150+
Rang to cancel, and got an offer of £105. Said no, and were assured we would not have the policy renewed.
About a week later, we received another set of cards, thanking us for staying.
We rang again, they assured us it was cancelled, and it was just the computer.
Today we received a letter, they have tried to take the money (the £155+), but couldn't, as the direct debit had been cancelled. (Surprise, I'm sure someone will tell me I shouldn't have done that.)
Would we like to contact them to pay, or send a cheque?
I'm sure the previous posters will be on shortly to find a way that was my fault as well?

birkee

keith1950 wrote: »

Hi, I too do not like auto renewal but I make sure when buying any insurance that I know the terms and conditions and keep a note of renewal dates etc. I start looking for better quotes up to 2 months before due and in some instances have found that the earlier you get a quote the better it will be. If anyone has not received a renewal notice within 1 week of the renewal date they should be ringing to find out why. Most of the complaints we hear are because of apathy and a lack of attention to detail that seems to pervade our society with a ' can't be bother' attitude and then kicking off when things go wrong then branding the insurer as 'slime ball' . In this case why did the customer not question the non-reciept of a renewal notice!!!
Everyone seems to use the Royal mail as an easy scapegoat to try to cover their own shortcomings.

This is just pompous.

The first time I was caught out, was because I had never heard of 'auto renewal' before. 50 years driving, and no such thing, as auto renewal existed.
My insurance has NEVER run out because of "apathy", and I'm seeking renewal quotes beforehand as a matter of course. The quote from last years insurer, is no interest, as it's THIS years premiums I'm interested in.

So why would I be making inquiries of last years insurer regarding lack of a renewal notice and premium?
Why would I look for 'auto renewal' small print in the T&C?

Auto renewal is a con.
It's up to ME who I insure with, not up to them to take my money by default. What happens if I had bought a Ferrrari since the first premium and needed a new quote? what happens if I had died during the previous year? Or had left the country? Or, been in hospital for 6 months?
Auto renewal takes your money whether they are entitled to take it or not.
It's a surreptitious money grabbing technique.
"It's in our account getting interest", whilst you try and claim it back.

dacouch

Back in the day before the internet was how most people purchased their cover, people normally used a broker.

People paid by cheque, cash or card, the majority of them would know when their renewal date was, the broker would send out a renewal invitation, another reminder shortly before the renewal date (If they had not renewed) and another reminder shortly after the renewal date (If they had not renewed). The broker would know most of their clients so would often ring customers to check with them if they had not renewed.

The Insurers then brought in monthly instalments as an option via direct debit, this is by it's nature a continuous payment agreement. The Insurers noticed that it gained them more new customers but that it also increased their renewal retention of customers so they pushed this.

This was a period when most Insurers had two sets of prices, one for new customers and one for existing customers. The existing customers benefited from cheaper premiums than new customers.

The internet has changed how we buy insurance and how the Insurers sell it, the vast majority of people buy their cover on price alone, so to gain business Insurers have to offer the cheapest premium. This can be done a number of ways, reducing the cover, offering new customer discounts (Aviva are currently offering 3 months free cover in the first year), reducing staff (Aviva are constantly making staff redundant and normally go for the most expensive staff which are the staff with the most experience) etc.

The internet model of Insurance sales reduces the processes as much as possible so one of them being staff to automate the process. They don't want to accept cheques and cash so card and direct debit payments are the norm. So they brought in automatic renewals on cards and no doubt have also noted the benefit that more people are renewing because of it.

Back in the day when people used brokers more for their car insurance you would get customers not realising their direct debit automatically renewed (Even though they had a clear letter from the broker and a separately sent letter from the Insurer outlining the new payments). If they had gone to a new Insurer the old Insurer would refund any payment taken without quibbling or taking charges eiher by a quick call from the broker or after requesting proof of the new insurance so they could see the new cover ran concurrently. They would do the same if the car had been sold and proof was sent in.

It's worth noting that during this period the vast majority of reasonable Insurers eg not Lloyd's syndicates would use pro rata rates for cancellations after the first years cover on motor (Short period rates eg loaded rates applied with all companies with a few exceptions) and all Insurers cancelled pro rata at any time for household cover.

The market has changed and I think we are lumbered with internet business being automated renewal, personally I think that Insurers and brokers should do what they used to and refund all the premiums without admin charge if the customer can prove they have concurrent cover. If the customer does not have concurrent cover then they should be able to charge a "reasonable" amount eg not punitive as the Insurer is entitled to some premium to reflect that they were covering the car.

The way we buy Insurance has changed, consumers need to understand how it has changed, Insurers need to review how they deal with deal with automatic renewals.

Unfortunately all the time people buy cover on price alone, most Insurers will respond by offering new customer discounts to attract new customers.

dreamypuma

birkee wrote: »

This is just pompous.

The first time I was caught out, was because I had never heard of 'auto renewal' before. 50 years driving, and no such thing, as auto renewal existed.
My insurance has NEVER run out because of "apathy", and I'm seeking renewal quotes beforehand as a matter of course. The quote from last years insurer, is no interest, as it's THIS years premiums I'm interested in.

So why would I be making inquiries of last years insurer regarding lack of a renewal notice and premium?
Why would I look for 'auto renewal' small print in the T&C?

Auto renewal is a con.
It's up to ME who I insure with, not up to them to take my money by default. What happens if I had bought a Ferrrari since the first premium and needed a new quote? what happens if I had died during the previous year? Or had left the country? Or, been in hospital for 6 months?
Auto renewal takes your money whether they are entitled to take it or not.
It's a surreptitious money grabbing technique.
"It's in our account getting interest", whilst you try and claim it back.

Firstly you would not particularly look for auto renewal in the small print. You would know it is there if you had checked your paperwork to ensure the policy met with your requirements in all respects. This would include the terms and conditions.

If auto renewal was included then you would discover it during this process and have the opportunity to make the relevant arrangements. If you haven't done this then I would question whether you know what you have bought.

In my experience, auto renewal is rarely in the small print.

Secondly, why would you have bought a "Ferrrari (sp) since the first premium" and not have already have advised your insurer? Surely you're insurance would be invalid anyway. But you would know that you need to keep your insurer informed of any significant changes in these circumstances anyway (had you bothered to read the paperwork) They will have already updated the information, and advised before making changes to your remaining premiums.

You will believe Auto renewal is a con if you don't take the time to understand what you are buying. But that is as a result of your own apathetic attitude towards reading and understanding the information given to you by the insurer.

You can't blame insurers for your attitude. They are there to make money, auto renewal is likely to be profitable for them. You need to man up and take responsibility for you own acts or omission or find a broker to look after your insurance needs.

Jane2005

Was just about to post that DreamyPuma, who would be silly enough not to contact thier insurer for a change of vehicle.

People are ranting on about being 'caught out'. Auto renewal is stated quite clearly in the original documents, it's written in bold more than once on renewal letters.

Grow up people, if you are old enough to have insurance, then you are responsible enough to remember renewal dates and organise accordingly.

keith1950

Hi, birkee , you look out for your renewal so you have some idea of the price to beat, do you mean you would go elsewhere even if the renewal was by far the cheapest you could get . You may have been caught out because you say you did not know about auto renewal but if you had taken the time to check what you were buying and read the terms and conditions you would have known- whose fault is that-yours. When you buy online there is always a 'tick box' to verify that you have read the terms and conditions, you do not appear to have read them first.
It is asking for trouble not to read the terms and conditions when you buy and then not check the renewal notice as a matter of course.
Are you saying that now you know about auto renewal you still don't read the terms and conditions ???

birkee

I think my points have been missed re auto renewal.

(1) If no renewal notice has been sent, how do you know whether your insurance premium has been doubled or not? (Or even worse)
Never heard of auto renewal at this time. First notice I had, was of threats of debt collectors and Bailiff's. (Swiftcover)

(2) They give you no opportunity to accept or reject this years premium amount.

(3) What insurer would issue insurance, without confirmation from the insured, that all conditions remain as described on the first insurance application.
You could be driving round having been banned from driving, and holding a certificate to say you are insured, and being able to tax the car with that same certificate of insurance.
re. this.
This is insurance practice across all sectors. They hope you lie on application forms, then in the event of a claim, they reject the claim because of it.
They get your premium, and have no liabilities to pay out.

Which is best practice?
The old way where you renew every year yourself.
The new way, where they take your money, in an unspecified amount, by auto renewal, and save on administration costs.
I would rather have a couple of pounds on my insurance premium for administration, than to find someone taking money from me without authority.
Your insurance goes up from £200 to £2000, and they drive your credit card into being overdrawn by £1400?..... It makes no sense.
I know the amounts I quote are ridiculous, but it's to indicate a point.

Bully for all of you that read through all the small print, but what's the percentage of people that don't? 90% ....95%?

keith1950

Hi, as long as I can remember I have received a renewal notice at least 3 weeks before the renewal date and auto renewal has always been clearly visible. (NOT IN THE SMALL PRINT).
If you do not receive the renewal either it has gone adrift in the post or the insurer has made a mistake, therefore questioning the absence of a renewal is important.
It is the insured responsibility to notify the insurer of any changes so if at the point of sending a renewal there have been no notifications the renewal is sent. When you receive the renewal you check it for any mistakes or ommissions and notify accordingly. It is more likely that the amount of people reading the terms and conditions is probably the reverse of your figures-90% do and 10% don't.
I don't like auto renewal but it is here to stay as more and more insurers change to it, there has even been speculation that the government will eventually make it compulsory so that 'forgetfull ' drivers do not end up driving uninsured.

Inactive

keith1950 wrote: »

I don't like auto renewal but it is here to stay as more and more insurers change to it, there has even been speculation that the government will eventually make it compulsory so that 'forgetfull ' drivers do not end up driving uninsured.

More " Nanny State " if somebody doesn't take out a new years insurance, that is their problem, as far as I am concerned my contract is for 12 months, no more, no less.

mikey72

Ok.
I accept you love auto-renewal, it's the bees knees etc.
So out of all the advocates who have posted on here,
how many have used it?

Me, never.

So I'll wait your answers.