Car insurance company's stitch up

dunstonh

My theory is that cause of many not reading them is that their mental model is they're buying an annual policy and that's the end of it. Confusion is caused by the industry not correcting this misconception because it's commercially advantageous not to.

Whilst that is possible, the insurers are required, thanks to the FOS, to put it clearly and plainly in the main letter (not hidden away in small text) what to do next.

If someone is too lazy to read the letter at renewal, then chances are they are too lazy to read it at the start, in between or whenever you disclose it.

The overwhelming number of complaints about this that we see on here are from those that have arranged insurance elsewhere (though granted no one would come on to post how grateful they were they'd auto-renewed).

We have seen posts from people saying they are pleased it auto renewed. More importantly, we have seen posts from people who say they didnt know their insurance had expired and wished it had auto renewed. You cant please everyone.

Guess it depends where you sit on the spectrum of individual responsibility versus 'we know what's best'.

Personally, I think the lack of personal responsibility is too often used as a get out and the more we dumb things down and allow people to shirk off responsibility for their actions, the more it gets worse. Most people do not get much post. It takes a matter of minutes to read the letter. A car insurance renewal letter is important and should be treated as such. That said, the letter should make it clear and concise on what to do next. If it does that then the person should only have themselves to blame. if it doesnt do that then the insurer should take responsibility and not auto renew (or refund if they took money)

dunstonh

yep, I "hope" but my parents generation (80+) grew up in a time when insurers did value their customers and could be trusted to look after the customers' interests. Just like the old dear with the house insurance thought

And the customers gave loyalty back. it works both ways. There is no loyalty in either direction with large companies. Unless you are talking local companies, you can forget loyalty.

vaio

As always you manage to make it sound like it's the customers fault that insurers take the mick on renewals.

The old dear with the home insurance mentioned above trusted her insurer to be look after her interests and instead of doing so the insurer loaded and loaded and loaded until after ten years she was paying more than ten times the market rate for her insurance.

With business practices like that is it any wonder the financial services industry is in the mess its in and the FOS is busier than ever as the industry lurches from one scandal to the next?

lovinituk

vaio wrote: »

The old dear with the home insurance mentioned above trusted her insurer to be look after her interests and instead of doing so the insurer loaded and loaded and loaded until after ten years she was paying more than ten times the market rate for her insurance.

There's always going to be something like this happening as services and technology evolve but some people can't/don't/won't adapt to the changes.

In a perfect world and all that, but...!

dunstonh

As always you manage to make it sound like it's the customers fault that insurers take the mick on renewals.

And as always, you think its the insurers fault.

The old dear with the home insurance mentioned above trusted her insurer to be look after her interests and instead of doing so the insurer loaded and loaded and loaded until after ten years she was paying more than ten times the market rate for her insurance.

They did exactly what they said they were going to do. They gave their price and their terms. She had the choice to accept it or not.

vaio

yep, I guess you are right, it is the old dears fault that she is paying ten times what she should just because she's foolish/traditional/trusting enough to think that her long term insurer won't use her loyalty as a way to enrich themselves at her expense.

In just the same way that endowments/PPI/credit rate swaps/sub prime etc etc were fair, worthwhile & legal right up to the point they weren't.

Hopefully, with all the additional staff the FOS has needed to take on they will be able to clear the decks of outstanding misdeeds and turn their attention to renewal loyalty tax

Pincher

Auto-renewal is GOOD?

I am so paranoid about it, I try to use credit cards that I could cancel if there is one.

Changed car this week, from a group 18 to a group 16.

I got a fresh quote, which is £350 for a year, versus £450 in January for the old car, so it has nine months to go. Instead of just giving me a refund for the difference for nine months, we had to cancel the old policy, and start a new one. As it was over the telephone, they asked me if I "Wanted to automatically renew using this credit card?" as well as going through the small prints item by item, for the benefit of the "recording for training purposes". Obviously I ENUNCIATED NO as clearly as I could.

It hit me that I don't remember feeling the recoil of defensiveness when setting the policy up back in January. This means that auto-renewal using my credit card was in the small print somewhere that I must have missed somehow doing it online.

My "model" of how it works is that this kind of insidious exploitation of inertia has a box for ticking and un-ticking when you are filling in a form, whether online or on paper. If auto-renewal can be hidden in the small print without a tick box, something is WRONG.