Campaigning: Home Insurance for Former Bankrupts

4$£&*(£$&*(!

Hello all

I have started a fresh thread on this topic to tell you what my campaign is about, where things stand right now, and how everyone can join in to right this wrong. The other long-running thread, at https://forums.moneysavingexpert.com/discussion/1854585 is still a vital resource and I welcome comments on it, but I felt I needed to bring the situation up to date and let people know what is happening.

First off let me describe the problem.

When insurers provide quotes, it is common for them to ask if you or anyone else resident at the property to be insured ever being bankrupt. Take a moment to consider how big this question is. The question isn't just asking about the policy holder, but anyone resident at that address, in their entire lifetime. Now try to get a quote on a price comparison website. You may find a tiny fraction of results are returned answering 'yes' to this question when compared to answering 'no', and the quotes may be several times higher (I have found on one price comparison site that quotes have doubled and even tripled).

Is this a big problem? I would like to argue it's a huge problem. If a policy costs £200 for a household which has never had a bankrupt resident, compared to £600 for a household where someone living there has been bankrupt in the past, then that's £400 each year over the odds they will pay. Then consider in the past 10 years there has been almost 1 million insolvencies registered. This means homes where residents have been bankrupt are paying potentially hundreds of millions of pounds more - and here's the important part - this extra price is *regardless* of how long ago the bankruptcy was.

So what do insurers say? Some say they don't even need to know about bankruptcy. Others say it is not an issue after a year or two. More information on specifics is on my original thread. Yet if anyone is tempted to lie about an old bankruptcy then make a subsequent claim, it is entirely possible the insurer could void your insurance since you wasn't truthful at the inception of the policy.

What is clear is the unfairness of a lifelong question. Currently, if a prison sentence is under two and a half years, once it becomes spent this does not need to be declared to insurers. Yet even if bankruptcy was entered into many years ago, since a question is being asked that has no time restriction against it, people are being penalised financially year after year.

So far I have tried to get the big names on board with little success. As part of this thread, a big change I am now asking people is to contact whoever you can in a position of profile, bring this thread to their attention and ask if they will help with lobbying. All they (or you) need to do is contact some of the groups I have been involved in, show some support and ask what the group is doing to address this.

Currently I am lobbying the Association of British Insurers http://www.abi.org.uk/Contact_Us.aspx and the Insolvency Service policy unit. I have provided evidence (again in the original thread) to the ABI indicating how insurers treat former bankrupts differently, and showing even the insurers show a desire for a uniform approach on this matter. Talks with the ABI have been going on many, many months now with little progress other than their advice they continue to progress the matter. The Insolvency Service has a rules committee I have only recently discovered, so it is too early to have received any responses from them.

It is time for change. Whilst it may be fair for insurers to make minor adjustments for a fresh bankruptcy to take into account additional risk factors (note - I have asked insurers about this risk and no-one has given me any evidence bankruptcy presents additional risk); it is fundamentally wrong insurers continue to penalise former bankrupts and their families for the rest of their lives. It is right to put in time limits when insurers and price comparison websites ask if someone in the household has been bankrupt. And the change is needed now, after what is becoming years-worth of my lobbying to move this change.

Please take a moment to contact someone of profile or relevance with this - whether it is a high profile individual, a consumer organisation, or the ABI themselves; advise them you are aware of this important issue and ask what steps they are doing to raise the profile of the problem so it can be addressed once and for all. I would really appreciate all feedback from everyone who raises this issue and what response you receive.

4$£&*(£$&*(!

I need some help please. Something's clearly gone wrong here, this thread has been on the go since last night and has over 70 views but not one single response. The original thread about this has dried up.

Can people please be honest with me - am I flogging a dead horse that no-one is interested in? It has really demoralised me starting this new thread and getting so many views but not even a single reply, is it time for me to walk away from this?

IF

Hi CitySlicker, I think we all appreciate the hard work your doing and sorry I didn't respond earlier. The board has been quite quiet lately and the last few days mainly newcomers posting worried about their first step of BR. Please don't lose heart.

Thank you
If...x

4$£&*(£$&*(!

Thanks I appreciate that, it feels so incredibly hard right now, and the one person I was alluding to I suppose in my initial post was Martin - I need him on board. Perhaps if others also show him through a PM it's a worthwhile cause it might help?

System

The thing is though, it's not a closed shop. The common advice here on MSE - especially for Home Insurance - is "go to the COOP". And indeed, they don't care about BR and their rates are competitive. People have reported they've got insurance with other smaller companies too, without hassle (or much hassle).

So while I think this is an important point to raise, it's not like people have no choice at all, or are always been swindled into paying more than they should.

beckyfojo

I'm not sure about whether this is a huge issue...

I used a price comparison site, and it came up as best with esure, I spoke to them on the phone and informed them of the bankruptcy and it wasn't a problem and the premium wasn't increased.

Obviously I've only tried this one because it was the cheapest anyway, so I don't know if this is a huge issue or not?!

sort_me_own_yard_out

I am in still in the stage of trying to dig my head from out of the sand and get it around the prospect of going BR. That in mind someone in my situation is probably a bigger risk now than when they go BR. I have even considered having an "accident" with my laptop/tv etc to make a claim. I DONT HAVE THE NERVE TO DO SO BUT, once i am BR my life will be damn sight easier and doubt that these thoughts would go through my head.

I would sign a petition.

Dee

jayk

Hi CS

Dont be discouraged. From a personal point of view I am in slight state of inertia and cant face officialdom at present and last thing would want to do right now prior to AD is contact MPs etc. However as I gain strength and confidence down line would look at it again. I have to say I was unaware that a home address can affect other persons within that home re insurance if OP has been BR or is BR. That is a concern. I would hatte to think that because of me others in family may be affected down line.

Not in position as yet to put insurance to the test- will not be until next year so unknown as yet.

PippaGirl_2

I'm pleased people are campaigning for fairer and more just treatment. I couldn't answer the poll as neither option applied to me. I have severe depression and anxiety and a good day for me is getting out of bed and finding food, so contacting anyone about anything isn't going to happen. But I do support what you are doing.

IF

Bump..........:starmod:

4$£&*(£$&*(!

I sent my original email to the MSE team on 9/6 and a follow-up on 25/6. Both remain unanswered.