Renewal Arrangement fee

vinylmusic

Today I received my renewal details
It showed the renewal fee plus £20

Renew al arrangement fee*
£xxx Total cost The amount payable includes Insurance Premium Tax where applicable.
*The arrangement fee of £20 is charged under a separate contract with Saga Services Limited.
Saga say that it is not an additional fee. They say that in the past the £20 was hidden in the renewal quote and now it is shown seperately
They say that there are costs in renewing a policy to pay underwriters and to update their system
I find that rich since I doubt if it costs so much to update an existing policy
I'm just wondering why they now show the £20 as a separate item to give the impression that the renewal quote looks cheaper
Is this standard across the insurance industry? or are Saga just trying it on?
I'm just suspicious that I am being charged an admin fee. just like if I changed address or other details during a policy

When using comparison sites do I just compare the renewal price or compare with the £20 added to it?

rudekid48

Does it matter? If you are happy with the price then why is the breakdown important? You would compare it against other quotes with the £20 as that is the total payable.
If you are not happy with it, vote with your feet

dunstonh

Saga say that it is not an additional fee. They say that in the past the £20 was hidden in the renewal quote and now it is shown seperately
They say that there are costs in renewing a policy to pay underwriters and to update their system
I find that rich since I doubt if it costs so much to update an existing policy

Are you suggesting that they should be providing the service/product for free?

I'm just wondering why they now show the £20 as a separate item to give the impression that the renewal quote looks cheaper

The renewal quote is the renewal quote. it wont look cheaper by them disclosing extra information because the figure does not change.

Is this standard across the insurance industry? or are Saga just trying it on?
I'm just suspicious that I am being charged an admin fee. just like if I changed address or other details during a policy

Think about it logically. They have given you the renewal quote. That is what you will pay. No more. No less. So, why do you think you are being charged more?

Aretnap

Saga are a broker - a middleman if you like, who go between you and the underwriter (the company which actually insures you).

Like all middlemen they don't work for nothing - they'll take their cut. Traditionally you would simply have paid a single fee, which Saga and the underwriter would have split between themselves according to their own contract. However it's arguably more transparent to show the underwriter's charge and Saga's fee separately.

Ultimately though, does it matter whether your renewal price is listed as (say) "£220", or "£200, plus a £20 fee"? Either way it costs £220, and the question for you is whether you can get equally good cover elsewhere for less than £220?

vinylmusic

I was mainly wondering if it was a sneaky add on that wasn't there before

stugib

Aretnap wrote: »

Ultimately though, does it matter whether your renewal price is listed as (say) "£220", or "£200, plus a £20 fee"? Either way it costs £220

However, should they cancel mid-term I suspect the fee wouldn't be included in any pro-rata refund calculation, they'd just lose it, so there is benefit to Saga in doing it this way. As well as IPT implication maybe? Don't see any benefit to the customer.

takman

vinylmusic wrote: »

I was mainly wondering if it was a sneaky add on that wasn't there before

It really doesn't matter!. Like others have said the only price that matter's is the total price and you should compare that against other prices on comparison sites. Then choose the lowest price for the cover that you want.