Car insurance comparison sites different 2022?

Grey_Critic

Being realistic about this it is the best guess - life is too short to check out every single detail - we check as much as we can and hope we have got it right.

An interesting aside - I am often surprised at people buying Home insurance without checking the details. I know a lot of people that call in a plumber when they have a water leak for example without knowing that the insurance cover they have includes Home Emergency, or have several insurances for the same thing so why should car insurance be any different?

Vegastare

My insurance renewal arrived post Xmas and had increased by £12 , there is also a lock in option for 3 years again slightly higher and better cover level, so on 31st Dec looked around and a non comparison company quoted £39 less. Valid till end Jan.

Time will tell how the comparison sites get round this, if they do!

Sandtree

Grumpy_chap said:

Sandtree said:

Differential pricing by channel hasnt been outlawed so if you bought over the phone then your renewal must not be more expensive than the current phone pricing but the internet can be lower priced. 

That kind of makes sense as the vendor can argue that the online price is fully self service, telephone has a basic admin / checking service and broker offers a full-service enhanced level akin to concierge service...

But it is persisted each year under the new rules so an original telephone service purchase continues to be compared to telephone service pricing even though the renewal is all done electronically. So its not just year one you pay the premium for having had an agent talk you through the form.

Certainly some firms don't just have online discounts but actually have a different pricing structure which is a little harder to rationalise from a risk premium perspective (are 18 year old drivers that use the telephone more or less risky than those that prefer the internet?) but may become more understandable when you remember that pricing also considers customer elasticity  and persistency 

Grumpy_chap said:

Sandtree said:

Differential pricing can come with a slightly different product though too but its insurance we are talking about so we are only interested in price and not value. 

Even in insurance, value is more than just the lowest price.
I can see, here, though, is the trick and deception around renewal prices / differentiation making the product different.  So, renewal is offered the basic policy whereas comparison site offers the full bells & whistles policy with legal cover, breakdown cover etc all included but then some "extra" or another is only available to buy through the comparison site so the whole thing becomes a farce.  That would appear to still be legal, though I am not an expert.

My comment wasnt denying that value exists in insurance but that its a commoditised distress purchase and so people buy almost exclusively on price. I recall some now fairly dated analysis done by a household name insurer who positioned itself as an ethical provider (that may have been questionable with some of their partners but still) and yet they found the average customer would leave them to save £1.50 per year and over 95% would leave to save £5 per year even when the other provider was a total unknown offshore outfit 

Comparison sites are seen as a different distribution channel to online and so you dont need to differentiate your product to segment them from your direct customers but many will because those customers are the most price sensitive and most happy to buy swiss cheese policies so they are often stripped back offerings to shave every penny off to get higher in the rankings.

Most insurers update their policy wordings every 6-18 months and most offer the new terms at renewal to avoid adding complexity in the claims department. I dont work in personal lines insurance at the moment so not as close to the changes but its probably worth looking at the relevant sections on backbooks/books in run off to see what protections have put in to prevent customers being left on old wordings and so can legitimately be priced differently to new business

jemimaschool

My existing car insurance with the same company for many years and guaranteed no claims discount is due for renewal. It has increased by over 20% and there are no changes to my details. I presume this is due to the 1st Jan. changes. The new legislation states that new customers cannot be quoted less than existing customers for the same product. The insurer appears to be have increased the premiums of existing customers so they are the same!  All the law states is that an existing customer should pay the same or less than a new customer quotation, but a new customer may not have the same level of discounts or indeed the exact same policy may not be available. I feel I am paying for the change in the law.

Sandtree

jemimaschool said:

My existing car insurance with the same company for many years and guaranteed no claims discount is due for renewal. It has increased by over 20% and there are no changes to my details. I presume this is due to the 1st Jan. changes. The new legislation states that new customers cannot be quoted less than existing customers for the same product. The insurer appears to be have increased the premiums of existing customers so they are the same!  All the law states is that an existing customer should pay the same or less than a new customer quotation, but a new customer may not have the same level of discounts or indeed the exact same policy may not be available. I feel I am paying for the change in the law.

You have it backwards, the renewing customer cannot be quoted more than a new customer is... insurers have traditionally given "new customer discounts" which are then unwound over the next couple of years meaning a loyal customer can be paying substantially more than someone that shops around each year.

The level of "discounts" - I assume you mean NCD - is considered when comparing the two prices.

The anticipated impact was that renewing customer's prices will come down a little bit and new business prices will go up a modest amount so meeting somewhere between the two. This therefore doesnt explain the 20% increase you are seeing but then you dont mention what class of insurance you are talking about as Home insurance has experienced worse exposure in the last 2 years because more time in the home means more opportunity for accidents to happen etc.

Its those that shop around each year that will be paying for the new regulatoins 

newlywed

Just had our fully comp car insurance quote through… it will be our second year of having a car…. And apparently we are expected to pay £160 a year more… pretty much a 40% increase - apparently the only reason for this is because we had a new customer discount last year!

time to shop around again I guess…though I had hoped the changes would mean that I didn’t have to spend 2 days of my life comparing insurance cover and quotes.

born_again

newlywed said:

Just had our fully comp car insurance quote through… it will be our second year of having a car…. And apparently we are expected to pay £160 a year more… pretty much a 40% increase - apparently the only reason for this is because we had a new customer discount last year!

time to shop around again I guess…though I had hoped the changes would mean that I didn’t have to spend 2 days of my life comparing insurance cover and quotes.

Except that you can't get the new customer discount anymore. It will not just be the lack of discount that has caused the increase.

oldagetraveller1

Received renewal quote from existing insurer last month, due 29th Jan. '22. An increase of about £20.

Checked a couple of comparison sites, cheapest was about £7 less than existing policy.

Phoned insurer to cancel auto renewal and ask if they could improve the renewal.

Offered £10 less than last year and less than comparison sites. Staying with them! 

forgotmyname

Comparison site emails received with figures £100 less than my renewal price.  Thinking I may get a bargain this year I log
in to find they have changed my quote, increased the excess and removed cover like protected no claims etc...

Add everything back and its only £1 cheaper than my renewal. Not worth the effort so I just renewed.