Is it time the insurance companies were reigned-in?

Doghousebob

Does anyone else think it's time the insurance companies were reigned-in for their extortionate practices and fees?

For example, a colleague at work got a car for his sister-in-law on the company car scheme. As he was the company employee, he had to have his name on the insurance, but never drove it. She was 'rear-ended' at some traffic lights and the other driver admitted liability and paid for all damages. When my colleague came to renew his own car on his own motor policy, his insurance company could see this bump on their database, and insisted on adding £46 to his private policy.

Another example, 'admin' fees. Since when does it cost £35 to change the address on a policy? If an insurance company has, say 10 people, handling calls, each lasting 10 minutes or so (for which we have to call them using 0845 numbers), it's easy to see what a money-spinner this could be for the insurance company.

I'm sure there are many more examples, but I basically think we are being used as a cash-cow for the insurance companies to milk, as we are legally and morally obliged to insure our vehicles.

Martin Lewis took on the banks for their unfair charges, how about taking on the insurance companies?

Ian011

Doghousebob wrote: »

Another example, 'admin' fees. Since when does it cost £35 to change the address on a policy? If an insurance company has, say 10 people, handling calls, each lasting 10 minutes or so (for which we have to call them using 0845 numbers), it's easy to see what a money-spinner this could be for the insurance company.

FCA regulations effective 26 October 2015 do not allow financial services firms including banks, card companies and insurers to use premium rate numbers starting 084, 087 or 09 for contact by existing customers. The regulations require a number starting 01, 02, 03 or 080.

As for the costs of running a callcentre, depending on who you ask you'll see figures anywhere from £5 to £50 quoted for the cost of dealing with a customer service call. There's rent and rates, heating and lighting, furniture, computer systems and many other things in addition to the obvious cost of wages.

HappyHarry

Many people, including the OP it appears, see all charges as pure profit for the company making that charge.

£35 for ten minutes work is a lot of money if there were no other costs.

But, £35 to cover the wages for the employee, for the chair the employee sits in, for the desk the employee works at, for the telephone on the desk the employee uses, for the computer on the desk the employee uses, for the databases that need monitoring and updating, for the lighting in the call centre, for the heating in the call centre, for the rent of the call centre, for the call centre manager's wages, for the training costs for the employee, for the confirmation that is sent out, for the business rates, for the fscs levy, for the fca fees, for taxation and a thousand other things that need to be paid for so that someone can change their address on their policy. Oh, and some profit (who wants their insurance company running at a loss?)

£35 sounds like a good deal to me.

dunstonh

Martin Lewis took on the banks for their unfair charges, how about taking on the insurance companies?

The unfair bank charges issue was lost.

Another example, 'admin' fees. Since when does it cost £35 to change the address on a policy?

Who is going to pay for all the staff, IT and infrastructure and how much do you think it will cost?

for which we have to call them using 0845 numbers

Which is wrong as pointed out above. When you are going to rant, it is best to do it with facts rather than the Donald Trump approach you are using.

ThinkingOutLoud_2

HappyHarry has a good list - but missed off some:- even the call centre agent is entitled to holidays, days off sick, sophisticated call recording, a complaints handling team (as these must be free) and of course they are sat there sometimes a few unusable seconds waiting for the next call (bless them).

A policy with his name saw a claim - but do you have proof that was why it increased.

Finally, if you are right - then why not buy some motor insurer shares and join the party? Or consider the reality - motor insurers made their first profit for 20 years in 2014. That lasted one more year and per EY "The brief era of profit-making for the motor insurance market has come to an end".

Perhaps, the biggest driver for separate charges is that everyone price compares so insurers are forced to strip out every ounce of extra to compete for your business at the lowest apparent price. At least the person who makes endless changes now pays for them not you.

hollie.weimeraner

Hmm so if you don't want penalising for someone else's risk don't take advantage of the company car scheme for a relative which requires you to be named on the insurance.

It's no different from me being rear ended in my wifes car last year as a named driver and having to declare the accident on both my wifes policy and my own renewal.

We will both be seen as being a higher risk this year due to some idiot that didn't see me turning right at a junction.

HappyHarry

ThinkingOutLoud wrote: »

even the call centre agent is entitled to holidays, days off sick

Good grief - it's these sloppy liberal workshy practices that got us all into this mess to start with. :rotfl:

stockton_2

MoreThan Insurance don't charge if you make the following changes on-line

>Change of car
>Change overnight location of car
>Change address
>Change driver details
>Change of use
>Change your car registration to a personalised or cherished number plate

But they will charge £25 for each change if you phone them up.

ThinkingOutLoud_2

Aviva the same free online or £18 - can make many, many cover adjustments, but no online address change.

Obviously OP, if you can manage to post online here, you might consider if doing your own policy admin online / picking an insurer who has invested to grant you that capability or charges less. Just like when you buy cars, you pay more but expect less to go wrong. Consider the total cost of "ownership". The charges / fees are there to be seen.

HappyHarry will then campaign for the call centre staff to be given more annual holiday, once there are less calls from you :-)

kingstreet

We could just go back to the days where we all pay higher premiums to cover the costs of those who need/want to make mid-term amendments...

Personally, I prefer the current "user pays" approach where those who cause the work pay for it and pay for the insurer's infrastructure to provide that service.

OnanTheBarbarian

Insurers are long overdue being reigned in but the government are spineless and happy to be under the thumb of large financial institutions and enjoy the substantial financial donations they make.

The insurers enjoy the run free environment thd banking sector enjoys. I.e. too big to properly regulate and everyone just has to accept their figures and spiel as gospel.

MSE makes a good living by issuing scaremongering posts about how armageddon is about to happen and you had better click on the links to their price comparison site friends and owners for an immediate quote.

You are all just cogs in the wheel.

Time for a levy on fuel to cover mandatory third party cover and give these bloated outfits a kick up the backside.

<steps off soap box