Unreasonable insurance charge?

Rambosmum

I had an accident on Monday and in conversation with my insurer yesterday informed them of my change of occupation (which had changed the week before, so hardly a long time ago). The guy I spoke with told me he would update the system with my new job title and we carried on the conversation about my accident.

Today I got an email bill for £90 for changing my job title- the bill says this includes an 'admin fee' but does not break down what is admin and what is a charge due to my job. I understand that occupations can affect insurance premiums but surely the man I was speaking to should have informed me of the additional charge?

Do I have any right to negotiate this charge?

BeenThroughItAll

Check the policy terms and conditions, and I bet you'll find the fees for policy adjustments outlined in there. If you do, you've accepted the terms by continuing your business with the insurer, so the guy on the phone doesn't have to do anything - the insurer can reasonably assume you've read the T&Cs.


If not, I'd try writing a letter to the insurer. For the cost of a stamp, it might be worth it although I wouldn't hold out much hope.


I suspect, since it's a round £50, it's an admin fee just for typing your new job title into the computer, and whilst £50 almost certainly isn't a fair reflection of the work involved, you've probably already agreed to it by signing the dotted line.








ETA: Misread £90 for £50. £90 does sound a bit steep. Ask for a breakdown!

Quentin

You should have been informed when you took out and agreed the policy conditions that a fee would be charged for mid term adjustments (somewhere in the policy docs).


If not then you have grounds to complain about the unexpected admin fee (not the premium alteration

EdGasket

It could be your different job is classed as more risky and hence there is a premium increase as well as an admin charge. You should get a breakdown of the cost though and find out exactly what it is for.

As for negotiation I am afraid mid-term they have you over a barrel as the only other option to paying what they ask is cancellation which would most likely involve even bigger costs.

gazfocus

EdGasket wrote: »

...As for negotiation I am afraid mid-term they have you over a barrel as the only other option to paying what they ask is cancellation which would most likely involve even bigger costs.

That in itself would be enough of a reason for me to cancel, but I appreciate that's not an option for everyone.

My wife recently bought a new car (her old car was a 2013 Seat Mii and her new one is a 2009 C4 Picasso).

She had 6 months left on her insurance policy so we contacted her insurer for a quote for the new car and they wanted an extra £320 (her original policy was only £553), which worked out at an additional £53 per month. We cancelled the policy, got a refund of £250 and new policy was £695, so while it cost us £495, we got an extra 6 months insurance and the whole policy only cost £57.91 per month.

Rambosmum

Having read the T&Cs the admin charge for changes is £19.50. Surely £70 is a bit steep for a job change?!

InsideInsurance

BeenThroughItAll wrote: »

I suspect, since it's a round £50, it's an admin fee just for typing your new job title into the computer, and whilst £50 almost certainly isn't a fair reflection of the work involved, you've probably already agreed to it by signing the dotted line.

Admin fees normally go up to ~£35, very few go as high as £50 let alone the £90 the OP says they've been charged.

Unfortunately the person typing something into a computer has to have a computer, not only that but there has to be a server that computer connects to over a network. These require IT people to create and maintain them. These computers also work better when there is software on them which again isnt given away for free and requires IT staff to maintain it.

For some crazy reason HSE says we have to give employees a desk for their computer and a chair to sit on and the council didnt like it when we set them up on the street and so we have to hire office space not only for the call centre person but the IT staff too!

You'd have thought if you give a man a computer, a desk, a building, you pay for them to have light, heating/ cooling etc they would run into work every day and the computer could do everything but no, you do need team leaders and team leaders need managers. Once you have all these people and buildings you then find you need pesky things like HR, Facilities, Legal, Payroll, Buyers etc.

Whilst many of us wish it wasnt, insurance is a regulated business and they demand we have audit staff to ensure your call centre agent is doing their job properly, Risk staff who ensure the business is controlled, Finance to pay all these peoples salary, collect the payment, for which of cause the banks & tax man take their slices etc.

So no, you arent just paying for 10 minutes of one persons time.

Rambosmum

InsideInsurance wrote: »

Admin fees normally go up to ~£35, very few go as high as £50 let alone the £90 the OP says they've been charged.

Unfortunately the person typing something into a computer has to have a computer, not only that but there has to be a server that computer connects to over a network. These require IT people to create and maintain them. These computers also work better when there is software on them which again isnt given away for free and requires IT staff to maintain it.

For some crazy reason HSE says we have to give employees a desk for their computer and a chair to sit on and the council didnt like it when we set them up on the street and so we have to hire office space not only for the call centre person but the IT staff too!

You'd have thought if you give a man a computer, a desk, a building, you pay for them to have light, heating/ cooling etc they would run into work every day and the computer could do everything but no, you do need team leaders and team leaders need managers. Once you have all these people and buildings you then find you need pesky things like HR, Facilities, Legal, Payroll, Buyers etc.

Whilst many of us wish it wasnt, insurance is a regulated business and they demand we have audit staff to ensure your call centre agent is doing their job properly, Risk staff who ensure the business is controlled, Finance to pay all these peoples salary, collect the payment, for which of cause the banks & tax man take their slices etc.

So no, you arent just paying for 10 minutes of one persons time.

I have no issue with an admin fee, and I've now found it to be £19.50, which I think is very reasonable. I am just shocked that my job title change has increased my premium by so much, when I am now in a less risky job!

BeenThroughItAll

InsideInsurance wrote: »

Admin fees normally go up to ~£35, very few go as high as £50 let alone the £90 the OP says they've been charged.

Unfortunately the person typing something into a computer has to have a computer, not only that but there has to be a server that computer connects to over a network. These require IT people to create and maintain them. These computers also work better when there is software on them which again isnt given away for free and requires IT staff to maintain it.

For some crazy reason HSE says we have to give employees a desk for their computer and a chair to sit on and the council didnt like it when we set them up on the street and so we have to hire office space not only for the call centre person but the IT staff too!

You'd have thought if you give a man a computer, a desk, a building, you pay for them to have light, heating/ cooling etc they would run into work every day and the computer could do everything but no, you do need team leaders and team leaders need managers. Once you have all these people and buildings you then find you need pesky things like HR, Facilities, Legal, Payroll, Buyers etc.

Whilst many of us wish it wasnt, insurance is a regulated business and they demand we have audit staff to ensure your call centre agent is doing their job properly, Risk staff who ensure the business is controlled, Finance to pay all these peoples salary, collect the payment, for which of cause the banks & tax man take their slices etc.

So no, you arent just paying for 10 minutes of one persons time.

First off, you'll notice I edited my post.


Secondly, I'm well aware of the costs of running a business thanks. Process improvement and strategy is what I do for a living. Care to put some numbers on the costs of the computers, servers, network, staff you so confidently speak of?


Technology is part of my business, so I know damn well how much it costs to run. Per-user costs for the type of infrastructure insurance companies run (yes, I have worked for them, in life and pensions, general, marine, specialist brokerage services) are probably nothing like what you think they are.

You're forgetting that the insurers don't have to cover all of those inconvenient staff and buildings purely from the cost of all those admin fees. They're able to sell insurance policies, take commission from breakdown firms, keycare policy sales, legal cover sales, sell information to claims management firms, etc; which represent the vast majority of their revenues.


They're making plenty of money on the policies and add-ons alone, and they would have to have most of their staff even if no-one ever amended a policy mid-term in order to deal with selling new policies, enquiries, renewals, claims, etc. So those people would be sat there in any case, and they'd still be making money without having to charge large fees for amendments.

JustinR1979

gazfocus wrote: »

That in itself would be enough of a reason for me to cancel, but I appreciate that's not an option for everyone.

My wife recently bought a new car (her old car was a 2013 Seat Mii and her new one is a 2009 C4 Picasso).

She had 6 months left on her insurance policy so we contacted her insurer for a quote for the new car and they wanted an extra £320 (her original policy was only £553), which worked out at an additional £53 per month. We cancelled the policy, got a refund of £250 and new policy was £695, so while it cost us £495, we got an extra 6 months insurance and the whole policy only cost £57.91 per month.

I've known people go from M3's to people carriers and insurance has doubled.
Might be to do with amount of claims, loaded up with kids, that sort of thing - so not a fair comparison of cars

Cyberman60

I would query it, asking for a breakdown, and if not satisfied, inform them that you are complaining about the amount of the charge and want it reduced, and that you are going to the Financial Ombudsman to challenge it if they don't.