Are all insurance increases ethical?

dkkendal

I have recently had my renewal quote, and as usual this has increased. I would then normally do my homework with comparison sites and bring that cost back down to below my previous years quote.

However this year I have gone to my current insurers website as well to find they could insure me at £400 lower than my current quote. Is this ethical that, they quote me so much less on the website than my renewal?

So where do we stand to fight back? If this was happening in a supermarket e.g. two Tescos sold things at separate prices, we would be in uproar and I'm sure trading standards would have something to say about it.

Does this not count in the insurance world?

mikey72

No, it's just a way of using auto-renewal, by them, to hope you miss the vastly inflated price.
Shop around, and move every year.

dunstonh

Is this ethical that, they quote me so much less on the website than my renewal?

yes it is. Its no different to a shop accepting bartering.

So where do we stand to fight back?

Fight back what?

If this was happening in a supermarket e.g. two Tescos sold things at separate prices, we would be in uproar and I'm sure trading standards would have something to say about it.

It does happen in supermarkets. I have a relative in managerial position with a supermarket and it runs multiple pricing models for different stores. Their price is not uniform across the stores.

There is nothing wrong with this.

All the broker/insurer is doing is waiving some of their income to retain business. They may be more willing to do this if they are focusing on market share rather than profitability at that time.

scooby75

dkkendal wrote: »

If this was happening in a supermarket e.g. two Tescos sold things at separate prices, we would be in uproar and I'm sure trading standards would have something to say about it.

Does this not count in the insurance world?

No. Trading Standards would not give a hoots as there is nothing to stop a supermarket selling the same product at different prices in different stores.

As for insurance, its common practice, almost. I have let my policy renew automatically because it was the cheapest price - even as a new customer it was more money than the auto renewal. The apparent excuse for a new customer quote being lower is to gain that customer from a competitor and hope they don't shop around next renewal.

As for fighting back, it's just a case of shopping around, not driving a car, depositing some silly amount in the Bank of England to insure yourself or leave the country to live in another one where private companies don't try to rip off customers - oh sorry, there isn't one!

vaio

dunstonh wrote: »

.......It does happen in supermarkets. I have a relative in managerial position with a supermarket and it runs multiple pricing models for different stores. Their price is not uniform across the stores.

There is nothing wrong with this........

scooby75 wrote: »

No. Trading Standards would not give a hoots as there is nothing to stop a supermarket selling the same product at different prices in different stores.......

Not exactly true, there are competition concerns about supermarkets selling the same thing at different prices in different stores because of the dangers of stores with no local competition making excess profits which are then used to cross subsidise stores in areas where there is local competition.

There are exemptions for different types of store (express & petrol stations etc) but a pint of milk should cost the same in every tesco supermarket in the UK and if it doesn't then the OFT/CC would like to hear about it

http://uk.finance.yahoo.com/news/Tesco-caught-operating-two-tele-61381291.html

mikey72

dunstonh wrote: »

All the broker/insurer is doing is waiving some of their income to retain business. They may be more willing to do this if they are focusing on market share rather than profitability at that time.

Or more likely they are tring to make excessive profits with auto renewals, and making the market average profit when they compete with similar quotes from others on comparison sites or if you re-quote as a new customer.

InsideInsurance

mikey72 wrote: »

Or more likely they are tring to make excessive profits with auto renewals, and making the market average profit when they compete with similar quotes from others on comparison sites or if you re-quote as a new customer.

Other than Motor insurance as a whole industry is making a loss

Norman_Castle

Other than Motor insurance as a whole industry is making a loss

Good, after decades of claim free driving I'm making a loss.

Spiderham

Norman_Castle wrote: »

Good, after decades of claim free driving I'm making a loss.

The larger a loss the industry makes the more premiums go up, so the more your outgoings will be.

Unfortunately every year thousands and thousands of people who have never had a claim in 10, 15, 20, whatever years of driving have fault claims, some of these can add up to tens of thousands of pounds and wipe out the entire lifetime income from that customer and many others. You can get some 7 figure claims. These have to be paid from the premium "pot" so that leads to increased costs. If any insurer thought they could afford to insure people for less and make a profit they would.