This automatic renewal scam is getting worse (rant)

2cb

Just done car and house insurance. The usual process: get a renewal quote, get a new quote for about 50% less, change company, contact new company to cancel the automatic renewal that they've "helpfully" applied.
With Churchill it's "Yes, that's fine. We'll send you a renewal quote and do nothing more".
With Aviva it's "We will delete your payment details, but we will still automatically renew your policy. You still need to cancel after you receive the renewal letter and before it expires. If you don't, we can't charge you but we will pursue you for a cancellation fee."
The policy is advertised with a big "new customer" discount, so there is no way that the renewal premium will be competitive. This is nothing more than a blatant scam to catch people out. I've made it absolutely clear to them that I will not be renewing the policy, and they still say that they will do this. I can't believe that this is legal. It seems that insurance companies have dug themselves into such a hole with their huge new customer discounts that they are taking desperate measures to make people pay the renewal premium.

dunstonh

This is nothing more than a blatant scam to catch people out.

Or is is a process that benefits the majority. Most people renew each year with the same provider than do not renew.

I've made it absolutely clear to them that I will not be renewing the policy, and they still say that they will do this.

If the company hasnt issued it's renewal letter yet then it may too early for them to register it as not being renewed. Most normal people will wait to see what they are being offered first before shopping around.

It seems that insurance companies have dug themselves into such a hole with their huge new customer discounts that they are taking desperate measures to make people pay the renewal premium.

The year one discounting is certainly an issue with some companies and the model is flawed but it is difficult to break out of it without accepting that it will cost you market share in the short term. Some companies do take a longer term view and price consistently year in, year out but others discount so much in year one that you know year two is going to be much higher.

2cb

dunstonh wrote: »

Or is is a process that benefits the majority. Most people renew each year with the same provider than do not renew.

Seriously? They pay £200+ (based on my experience) extra every year for the convenience of staying with the same companies? You're a "Mega Magnificent Maxi-Meticulous Uber-MoneySaving Magnate", do you let them auto renew your insurance every year?

dunstonh wrote: »

If the company hasnt issued it's renewal letter yet then it may too early for them to register it as not being renewed.

They keep a record of my correspondence don't they?

dunstonh wrote: »

Most normal people will wait to see what they are being offered first before shopping around.

I will wait to see what is being offered. If their quote is competitive then I will contact them and accept it. That's what I'd call a normal way of doing business. They are obviously hoping I will forget to cancel, otherwise they would be happy to just send me a quote.

InsideInsurance

Given it is now a criminal offense to have a car that is neither SORN'ed nor insured it is also helping a lot of people who buying car insurance isnt their top priority/ are prone to forget, not only them but also helps those they have accidents with.

Not only is it not illegal, it has been actively encourage because of the above. I never spent much time dealing with Policyholders themselves and with 90%+ of the book of the policyholders of that insurers being on autorenewal I still had at least 4 cases where someone had an accident after their policy lapsed and they'd forgotten to renew (though in one case it was partially the insurers fault)

4 people arguably isnt many but that is one person in one call centre for one insurer for under 3 months. Gross that up to the total and it is a very significant number.

If you dont want to be caught by the year 2 hike in premiums buy from a more expensive insurer in year 1 that doesnt have new customer discounting and then you know that year 2 plus will be roughly the same assuming you dont claim etc.

forgotmyname

Auto renew or SOB...SOB... weep weep... Sorry soggy keyboard.

I popped to the sandwich shop at lunchtime 1pm had an accident with a lorry, Cars a mess had to be towed away.

Phoned the insurance and it seems my insurance expired at midday. Seems in the renewal they sent, That i didnt bother to read, It states i need to phone to confirm renewal and pay them.

I assumed it auto renewed and not they wont pay out and i have lost my car.
The garage are charging £18 a day storage. They said im lucky the breakdown company towed me in otherwise it would have been £287+vat to tow it in.

HELP what do i do next?

Auto renew is not a scam.

dacouch

The ironic thing is that auto renewal means the premiums of the OP and other people who shop around each year are subsidised by the auto renewal.

If the auto renewal was stopped, his new business premiums would increase.

dunstonh

Seriously? They pay £200+ (based on my experience) extra every year for the convenience of staying with the same companies? You're a "Mega Magnificent Maxi-Meticulous Uber-MoneySaving Magnate", do you let them auto renew your insurance every year?

This year I have had my renewals for my three cars and house. Three stayed with the same insurer. One was moved. The one that moved gets moved every year as it is stuck in the year one discounting cycle. The others have been consistent for some time.

Your experience is your experience. Doesnt mean it is normal.

They keep a record of my correspondence don't they?

It is more likely their software doesnt have the option to not renew until the renewal documents have gone out.

I will wait to see what is being offered. If their quote is competitive then I will contact them and accept it. That's what I'd call a normal way of doing business. They are obviously hoping I will forget to cancel, otherwise they would be happy to just send me a quote.

That isnt what you have said though. You said you phoned them prior to renewal documents saying you did not wish to renew.

prowla

I called back about my auto-renew policy and got about £200 off.
So, it is good as a safety net, but do not assume that the price in the auto-renew quote is the best.

CKhalvashi

forgotmyname wrote: »

Auto renew or SOB...SOB... weep weep... Sorry soggy keyboard.

I popped to the sandwich shop at lunchtime 1pm had an accident with a lorry, Cars a mess had to be towed away.

Phoned the insurance and it seems my insurance expired at midday. Seems in the renewal they sent, That i didnt bother to read, It states i need to phone to confirm renewal and pay them.

I assumed it auto renewed and not they wont pay out and i have lost my car.
The garage are charging £18 a day storage. They said im lucky the breakdown company towed me in otherwise it would have been £287+vat to tow it in.

HELP what do i do next?

Auto renew is not a scam.

This is the point.

I was driving round a few years back without tax, insurance or an MoT as I'd completely forgotten about it. It was only for a few weeks, but it could easily have cost me my license.

CK

Mr_K

prowla wrote: »

I called back about my auto-renew policy and got about £200 off.
So, it is good as a safety net, but do not assume that the price in the auto-renew quote is the best.

Which goes to prove what a scam autorenew is. Good for us that are vigilant, but hard luck for the majority of mugs (customers), who don't even realise they can haggle, or remember last years premium. My insurer hasn't sent me a renewal this year - I had to pursue them to find out what premium they are going to kindly 'autorenew' me on.

Fair enough if autorenew is something you want to opt into, but most insurers are now using this as the default arrangement. It might reassure punters if the companies had an option of not autorenewing, if your premium increased by more than say 20%. Don't think they'd be keen, wonder why?

OP - you're banging you head against a brick wall on this forum - it's inhabited by those with a vested interest in the insurance industry.

2cb

Seriously. If you can't manage to read your renewal letter and call up to accept it, how do you manage to renew tax, mot, get your car serviced, fill up with fuel... You are not responsible enough to be in charge of a motor vehicle.