MSE News: The devil is in the details: Insurers charge huge fees for simple changes

dunstonh

1. £25 for somebody to edit a record on a computer, overwrite and save it. Ummm, yes I believe that is extortionate.

Then I suggest you dont try and run a business then.

2. Name other industries that do this?

Any business that charges on explicit basis. Remember there are two models in force here. Higher premium/no admin charge vs lower premium with admin charge. If you dont want admin charges then pay a higher premium.

4. What is silly is your lack of basic understanding in how businesses should operate.

Straight back at you.

5. How is moving a house in somebodies control? unless you bought a house then the chances of you moving out are slim but for students and the likes who move a lot it is a nightmare and usually due to reasons out of their control.

It is in your control. People decide when they want to move house or stay in their existing.

You need a reality check

Indeed you do.

napu2400

Changing address should be a simple form on the website, not something that costs £20+.

rudekid48

napu2400 wrote: »

Changing address should be a simple form on the website, not something that costs £20+.

Indeed. So who pays for the design, build and testing of that website? Who pays for the hosting services to keep that web site in-line? Who pays for the security around that website that must be in place to protect your data? Who pays for the storage of the data that the website generates? Who pays for the system sitting behind the website that calculates the revised premium from your change? Who pays for the hosting and support of that system? Who pays for the people that support / update / enhance that website and system behind it? Who pays for the people sitting in a call centre that have to be there for those that need help or don't have access to the internet? Who pays for the payment processing charges that every business incurs if they take payments on-line? Who pays for the people that do all the analysis to set the pricing for every conceivable change that you may wish to make? Who pays for the people that then code those changes? I could go on but hopefully you get the point.

There is a choice here. Not every insurer charges admin fees, but in return they tend to be at the higher range of the premium scale. Personally, I would rather pay a cheaper premium and then just pay for changes that I make - if I make none then I'm quids in...

ThinkingOutLoud_2

So why can't comparison engines keep pace with the practice of insurer's fees. Or do some manage that?

The best airline comparison engines let you choose if you want a hold bag or not, so you can compare like for like.

If a fee must be paid to allow a policy to lapse - that seems pretty unavoidable. Show it to every buyer like the excess.

If your fees for changing address or a car are upwards of £10 - then that is just as relevant to most as a claims deductible or excess surely?

And why don't the FCA make insurers display all such such fees /costs prominently in the Policy Summary or any table highlighting the benefits, to be shown and accepted explicitly when buying or even better make sure they are reasonable ?

It is patently obvious from the general reaction in this forum that most are not aware of the fees buried in the full policy wording document.

I'd agree people should take care buying and read the terms; but that is no excuse for the Financial Sevices industry trying to be transparent or for what could understandably be seen as a deliberate policy to hide such fees by many.

rudekid48

ThinkingOutLoud wrote: »

So why can't comparison engines keep pace with the practice of insurer's fees. Or do some manage that?

Because they get paid their £60-£80 fee by the insurer regardless and are not the ones that take the flak - their own fees should be transparent though, too many people don't realise the huge income they generate

The best airline comparison engines let you choose if you want a hold bag or not, so you can compare like for like.

Much easier to compare the smaller number of providers & options

If a fee must be paid to allow a policy to lapse - that seems pretty unavoidable. Show it to every buyer like the excess.

Not heard of that fee

If your fees for changing address or a car are upwards of £10 - then that is just as relevant to most as a claims deductible or excess surely?

Agree, so why do people shop on headline price regardless?

And why don't the FCA make insurers display all such such fees /costs prominently in the Policy Summary or any table highlighting the benefits, to be shown and accepted explicitly when buying or even better make sure they are reasonable ?

They do on both counts

It is patently obvious from the general reaction in this forum that most are not aware of the fees buried in the full policy wording document.

Fees are not buried in policy wordings, they have to be clear and up front. The FOS will overrule any fee that is withheld or purposefully hidden

I'd agree people should take care buying and read the terms; but that is no excuse for the Financial Sevices industry trying to be transparent or for what could understandably be seen as a deliberate policy to hide such fees by many

You can lead a horse to water etc. Financial services is one of the most heavily regulated industries around - that is not the problem. The problem is the race to the bottom for headline prices on comparison sites and some people's inability to actually read what they are signing up to. It never ceases to amaze me how people will select a policy based on getting a cuddly toy or robot rather than basing their decision on quality and if the product actually fits their requirements.

Added to your post...

ThinkingOutLoud_2

rudekid48 wrote: »

So why can't comparison engines keep pace with the practice of insurer's fees. Or do some manage that?
rudekid48 = Because they get paid their £60-£80 fee by the insurer regardless and are not the ones that take the flak - their own fees should be transparent though, too many people don't realise the huge income they generate

I agree the comparison engines charge insurers what feels like high fees, but that does not prevent them doing a competent job of presenting like for like on a total cost basis.

rudekid48 wrote: »

The best airline comparison engines let you choose if you want a hold bag or not, so you can compare like for like.
rudekid48 =Much easier to compare the smaller number of providers & options

Not sure that is right - many, many airlines and agents / intermediaries..Making a simple comparison on options(;-))
e.g. Motor options = excess, legal, hire car, breakdown, going abroad and a few more maybe
Airline = time of day flights, destination, airport cabin class, select seat, baggage, meals, travel insurance and cancellation/change flexibility
>>> But, in 2017 I am sure presenting a few options clearly should not be beyond a smart comparison engine.

rudekid48 wrote: »

If a fee must be paid to allow a policy to lapse - that seems pretty unavoidable. Show it to every buyer like the excess.
rudekid48 = Not heard of that fee

I am sure I have seen recent thread posts where people claim they being charged not to renew.

If your fees for changing address or a car are upwards of £10 - then that is just as relevant to most as a claims deductible or excess surely?
rudekid48 = Agree, so why do people shop on headline price regardless?

So I think they don't realise the price is not directly comparable or only a headline price - they trust the comparison engine to highlight any material differences - after all that is what comparison means right?

And why don't the FCA make insurers display all such such fees /costs prominently in any table highlighting the benefits
rudekid48 =They do

I am not sure sure they are so prominent as say excess ...
http://www.admiral.com/about-us/features-and-benefits.php - just one not one mention of any fees to check out here (all lovely benefits)
http://www.aviva.co.uk/car-insurance/summary-of-cover/ Again - all the benefits and also excess info - but nothing about fees to check (but to be fair despite your suggestion in prior post online changes are fee free)
Both have links to their wording etc, I know!
It remains obvious from the general reaction in this forum that most are not aware of the fees somewhere or spread over several places in the full policy wording document.

We both agree people should take care buying and read the terms

Durbanitejoller

I recently moved home and when I gave the car insurance company Hastings Direct my new address they charged me an admin fee of £25.00. When I challenged that they said that if I don't pay the fee they will cancel my insurance.

:mad: Guess who's going to be shopping around for a new deal when my insurance expires?

ThinkingOutLoud_2

Good luck finding a cheaper policy without such feees for changes.

jhalinson

If you use Aviva online then there are no charges for changing details, even changing car.
Well done to Aviva

ThinkingOutLoud_2

jhalinson wrote: »

If you use Aviva online then there are no charges for changing details, even changing car.
Well done to Aviva

Agreed. Aviva has a great self-admin tool.

It also works really well if say you decide to drive to France for your holiday in the middle of your policy year. You can add on cover abroad and then remove it afterwards.

Same goes for reducing your estimated mileage to your actual and get a refund!

BUT while they started cheaper - they became very expensive for me despite no claims ... so I am not sure if they changed their appetite or they play the game of screwing their loyal customers?

You can also download an app that monitors your driving for a few hundred miles and then adjusts the premium. Downwards for most they claim.

Good tech whatever.