Car Insurance Renewal in Early February 2022

anotheruser

I have half read about what's happening to insurances on the 1st of January 2022 so wonder whether I should go through confused.com before and get a quote secured in (they're usually valid for 60 days), but this is quite a bit before the magical 24 days prior to renewal date.
I don't want to renew now as I'll lose a year's worth of no claims, although I have over 15 now so it's almost irrelevant.

Any advice?

JohnBernardP

If you can get a quote on a PCW AND it is guaranteed for 60 days then I see no reason why you can't or shouldn't do it. At worst you lose a little time, at best you gain any new business discounts or offers they have available and will be withdrawn. I don't know if any quotes that you get effective in February will automatically remove any new business discounts if the quote is done in December.

If you cancel your current insurance policy you will (as you say) not gain another year's no claims bonus - but I don't think any insurance company give an enhanced no claims bonus for a 16th year. What you will lose of course is the month+ cover that you have already paid for.

To give some more information about changes in January.

The FCA have long decried the practice of 'price walking' in which increased premiums charged to customers at renewal is used in some respects to offer cheaper premiums to customers at inception. This was previously good news for people who regularly shopped around, but discriminatory against those who showed loyalty to the brand (or too lazy to switch each year).

So they have taken steps.

From January 2022, an insurance company or broker cannot charge an existing customer more than they would a new customer. (The ENBP - Equivalent new business price) using the same distribution channel.

Thus: if they quote a price for you of e.g. £400.00 for a new business case on confused.com then they have to offer the same premium to an equivalent person at renewal where the business came from confused.com: they cannot add on 'renewal fees', increase the premium (or even their commission rate). Furthermore any benefits in kind have to apply equally - so if they offered  new customers a free MOT, then they have to offer their customers the price equivalent saving at renewal. If they promote their product on a cash-back site, then they have to offer customers the same discount at renewal that they would get from the cash-back site. I expect a lot of the cashback sites to find their motor and house insurance cashback offers substantially reduced.This also applies to add-ons e.g. legal expenses, motor breakdown, excess cover etc.

This does not prevent a company from e.g. quoting a price of £400 on confused.com and £380 on comparethemarket - provided they treat all customers secured on comparethemarket at renewal on the same basis, so there may be some benefit in shopping around. Nor does it prevent an insurance company from offering a reduced price at renewal e.g. if you ring them up complaining about your price increase (although one effect of the new rules is that there will no longer be massive price increases at renewal - due to the abolition of 'price walking'.) Similarly if an insurer has a special scheme then they can offer lower rates on the scheme - again provided that the renewal price is no more than the ENBP/

What we WILL see is that price comparison websites will become more expensive as insurers/ intermediaries will be unable to offer selective promotions to attract new business - paid for by existing policyholders.

Note that these rules only apply to household and motor insurance (including motor cycles, vans used for pleasure and, interestingly, touring caravans).

daveyjp

From our experience it has made no difference.

My wife's insurance is due 10th Jan.  Renewal was about 10% less than last year and there was an additional £20 off for renewing within a week of the quote, which in her case was about another 10%.  

Her insurance next year is now probably about as low as it has ever been.

fincherdavid

Nor does it prevent an insurance company from offering a reduced price at renewal e.g. if you ring them up complaining about your price increase (although one effect of the new rules is that there will no longer be massive price increases at renewal - due to the abolition of 'price walking'.) Similarly if an insurer has a special scheme then they can offer lower rates on the scheme - again provided that the renewal price is no more than the ENBP.