SAGA :three year fixed

JIL

Last year on renewal of my house/content insurance I renewed with the then current provider which was SAGA. A conversation followed as to you can lock this price in for three years, I was happy with the price of just under £200, checked again by asking is this what I will pay next year, to be told, yes definitely.

So my paperwork for year 2 has arrived, with a note to say that the insurance would actually be cheaper this year, just by a couple of pounds. It's on automated renewal anyway.
BUT there on the letter is a £25 renewal arrangement fee. 

Now this letter is computer generated, probably no human interaction anywhere, what an absolute cheek. 

Can I get out of the three year auto renewal?

I hope this also serves as a warning to others.

Jaybee_16

Have you phoned SAGA to ask about this? 

I am in year three of the fixed price deal and never been charged a £25 renewal fee. I have also moved home address three times and never been charged an admin fee.

This just seems rather odd to me. 

Dazed_and_C0nfused

So is it,

Just under £200 + £25
Or

Just under £200 including the £25?

JIL

It's just under £200 plus £25 arrangement fee.

JIL

Here is a photo

Annemos

Not an expert on this, but I would have expected there to be an arrangement fee each year. 

So say in 2020 if my policy cost  160 pounds and the arrangement fee was 25 pounds = 185 total. 

Then I would not be surprised to see 2021 at 160 pounds again plus an arrangement fee of 25 pounds = 185 again. 

(And in 2021, it they even put the arrangement fee up a bit, I would not be too surprised.... say to 30, as long as it was not too outrageous.) 

I have always imagined that it is the actual policy itself that is fixed. 

JIL

I have checked last years payment and it was £23 less than this year.

I will call them on Monday. I thought it would be straight forward to just renew at the same price as last year. 
Just a bit shocked to see an unexpected extra, if I had known I would have probably shopped around and gone through a cashback site.

Annemos

I agree, that does seem odd, if the arrangement fee is exactly the same for both years.

I wonder what strange reasoning they will come up with. Do please let us know. 

Enjoy the rest of the weekend. 

dunstonh

Now this letter is computer generated, probably no human interaction anywhere, what an absolute cheek. 

How much do the computers cost?
How much does the electricity cost and all the other utilities?
How much do the staff that program the computers cost?
How much do the acturies, compliance staff, support staff etc cost?

Just a bit shocked to see an unexpected extra

What makes you think it is extra and not a change from implicit pricing to explicit pricing? i.e. not disclosed previously but factored into the premium vs removed from the premium and added on explicitly?

Where explicit charging exists, you have to combine the two to get the bottom line.  Where implicit pricing exists, you just get the bottom line.  You don't know what the broker/distribution company is getting out of the premium.

I have checked last years payment and it was £23 less than this year.

If you had a price guarantee, then I would expect it to be the same bottom line (or cheaper).   Although insurance premium tax is not charged on admin fees.  

Just a bit shocked to see an unexpected extra, if I had known I would have probably shopped around and gone through a cashback site.

Shouldnt be unexpected.  It is on the policy documents (page 5 - but the main text doesn't start until page 4 due to cover page, contents etc).  Saga have been charging this for many years.

JIL

dunstonh said:

Now this letter is computer generated, probably no human interaction anywhere, what an absolute cheek. 

How much do the computers cost?
How much does the electricity cost and all the other utilities?
How much do the staff that program the computers cost?
How much do the acturies, compliance staff, support staff etc cost?

Just a bit shocked to see an unexpected extra

What makes you think it is extra and not a change from implicit pricing to explicit pricing? i.e. not disclosed previously but factored into the premium vs removed from the premium and added on explicitly?

Where explicit charging exists, you have to combine the two to get the bottom line.  Where implicit pricing exists, you just get the bottom line.  You don't know what the broker/distribution company is getting out of the premium.

I have checked last years payment and it was £23 less than this year.

If you had a price guarantee, then I would expect it to be the same bottom line (or cheaper).   Although insurance premium tax is not charged on admin fees.  

Just a bit shocked to see an unexpected extra, if I had known I would have probably shopped around and gone through a cashback site.

Shouldnt be unexpected.  It is on the policy documents (page 5 - but the main text doesn't start until page 4 due to cover page, contents etc).  Saga have been charging this for many years.

Thanks, 

But my point is, that last year I paid less than £200. I was asked if I wanted to fix this price for 3 years. No mention of an additional charge.

Theres a renewal arrangement fee added on this year. However the price I fixed last year is a couple of pounds cheaper this year. But not really as theres an additional cost.

Of course its unexpected, it's on page 5 of this years renewal paper work. It was not on last years.

I will phone tomorrow, after doing a few online quotes.

dunstonh

But my point is, that last year I paid less than £200. I was asked if I wanted to fix this price for 3 years. No mention of an additional charge.

Do you have anything on the terms of deal from last year?   

Of course its unexpected, it's on page 5 of this years renewal paper work. It was not on last years.

I looked at their new business PDF.   It was on there.   As SAGA have been charging this for years, then it should be on what you got last year.  If its not, then you have some ammunition to raise a complaint to them.