Green Flag - when is a no callout discount not a no callout discount?

Robboseven

When it's a no callout surcharge!

My Green Flag breakdown cover was due for renewal last month. The renewal offer came through the post with the good news that 3 years "No Callout Discount" had been applied to my account.

With this in mind I looked at last years annual fee and discovered they were increasing my annual fee this year by about £10.

I called them and I was told that all of their charges had gone up because of being called out more. "not by me" I said "you're giving me a discount so I assume my increase would have been a lot more?" "yes" was the reply. "So what % discount are you giving me for not calling you out?" "I can't answer that question as I don't have the information" came the reply. "But it would be a discount from what you would offer say a new (and unknown risk) customer?" - "yes" said the CS person.

"Wrong actually" I said "you would offer a new customer a price £11 cheaper than you offered me as a renewal, even with a 3 year no callout discount"

"So it's a no callout surcharge or, in other words, the longer I'm with you, the more it will cost"

Why does almost every business see this as smart marketing nowdays?

Needless to say I cancelled the renewal. I was going to sign up again as a new customer but they don't deserve the business. Just used my Tesco clubcard points to sign up with RAC for 12 months.

JimmyTheWig

Robboseven wrote: »

"But it would be a discount from what you would offer say a new (and unknown risk) customer?" - "yes" said the CS person.

The answer should have been "no", clearly. It is (theoretically, at least) a discount on the renewal price that would have been offered to someone with three years membership who _had_ had a callout.

anotherbaldrick

Time all these companies woke up to the fact that we are getting very cynical regarding renewals and price hiking and are not giving any spurious assumed loyalties credance and are doing the yearly trott .

im-lost

anotherbaldrick wrote: »

Time all these companies woke up to the fact that we are getting very cynical regarding renewals and price hiking and are not giving any spurious assumed loyalties credance and are doing the yearly trott .

I'm sure these companies know full well that a large majority won't even look at a renewal and just let it go through.. Or they wouldn't do it.

forgotmyname

I use the RAC and have to phone them each year now otherwise the price jumps.

ILW

It's mainly down to comparison sites.
Many companies have to price at a loss to get a customer, they then hope to keep them at a higher price when the renewal comes up.

Robboseven

im-lost wrote: »

I'm sure these companies know full well that a large majority won't even look at a renewal and just let it go through.. Or they wouldn't do it.

Of course, that's exactly the point I'm making. It's a cynical ploy which plays on people's apathy, laziness, lack of awareness, naivety, gullibility etc etc
It certainly works because, as you say, they wouldn't do it and neither would energy suppliers, insurance companies, mobile phone companies and the rest. In fact with renewable contracts it has become the norm sadly.

Ilona

forgotmyname wrote: »

I use the RAC and have to phone them each year now otherwise the price jumps.

I'm the same. My RAC renewal letter has just arrived. Every year I ring them up and ask, what happened to customer loyalty and no call outs. Why do new members get a better discount. They are all the chuffin same, maybe I'll sign up with Green Flag, or the AA.
Ilona