Home insurance renewal 'computer says no'!

janelle

When I called my top ranked Home Insurer recently about a rise in premiums, I was told when I asked about it that they had voluntarily agreed to a government scheme detailed at floodre co uk to cover flood risk areas not necessarily related to your own area. I was surprised as it amounted to around an extra £60 on the premium. Definitely worth checking with individual insurers about this before renewing.

This prompted me to shop around as we were already paying an above average amount for a premium service. After getting a few quotes I decided to go back to my existing insurer and bargain.

To my surprise, when I asked them to quote a premium for their two cheaper products we arrived at a spectacular 'computer says no' scenario. The cheaper products were going to cost an extra £200 for the intermediate and an astounding extra £300 for the basic one, adding up to over £700 for their basic cover! The customer service person was clearly baffled, had never seen this before, checked the data and could see no error and promised she would go to her IT support and find out what had happened.

I have a few theories, one being customer retention isn't a high priority for home insurers, and instead of loyalty being rewarded it is punished. Any attempt to wriggle out of said 'punishment' is blocked. I would have thought however, that products offering less cover would still cost less. Clearly not.

I await their response, if any, with much curiousity.

FutureGirl

Insurance is all about risks. If an insurer feels you are too high a risk they will either decline to quote, or will quote you quite high in the hope you go elsewhere, or that you'll have the high quote.

Don't forget that many things increase a premiums, and is done by statistics. It could be that there are more people in your area (example) that have the basic cover that claim more. Whereas those with the better policies tend not to claim more - this is just one example of many on how they calculate for a risk.

I'm always confused when people act surprised to find out there is no 'loyalty' these days - it's a business! They can quote you what ever figure they like, if you don't like it - go elsewhere. That will be their response - this is the price.

ThinkingOutLoud_2

FutureGirl wrote: »

I'm always confused when people act surprised to find out there is no 'loyalty' these days - it's a business! They can quote you what ever figure they like, if you don't like it - go elsewhere. That will be their response - this is the price.

I am inclined to agree - it is not like the majority of customers show any loyalty for insurers to respond to. We are both perhaps getting what we deserve?

dacouch

It sounds like to me that your Insurer has increased the premiums dramatically in your area due to the amount of claims / amount of predicted claims.

Your renewal premium shows an increase but as an existing customer they have pegged any increases to a maximum eg 15% or 20%.

However when they run through a quote for you on their other products their computer treats you as a new customer (Without any increases being limited) and quotes the prices a new customer would pay