Car insurance - The price of honesty!

My car insurance renewal came through.

A week ago my wife was driving a hire car which was fully insured by Ryanair. As she was stationery at traffic light someone ran into the back of her. He admitted liability (which I videod).

Being an honest person, when I wanted to renew my insurance I declared that my wife as a named driver on my policy (she drives it about 3 times ayear) had had this no fault accident.
They immediately ran the renewal quote again and the renewal price has gone up £100.

I wonder how many people would have declared this, and if I needed to claim whether anyone would have discovered this very minor bump (broken brake light glass) in a foreign country?

I know someone will say they have a team of boffins working out how this indicates that my car is statistically more likely to be involved in a claim but I really don't beleive it.

It does make me think I'm too honest!


Comments

  • DullGreyGuy
    DullGreyGuy Posts: 9,173
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    The reality is probably that if everyone did declare that had to then the impact would be less but as many choose to "forget" those that are honest are hit harder. 

    Presumably you have since which shopped around? Different insurers take a different view and I know when adding a non-fault claim to one of my policies it made no difference at all. 

  • I know someone will say they have a team of boffins working out how this indicates that my car is statistically more likely to be involved in a claim but I really don't beleive it.

    It does make me think I'm too honest!



    There are people who don't believe the earth is round, but I'm not sure it changes the fact we're living on a big ball.  

    The price of honesty is generally a lot lower than the price of dishonesty when it comes to insurance.
  • I have now shopped around and got a deal I'm happy with (from the co op).

    During my conversations I discovered that Direct Line and Churchill despite being 'partner companies' or the really one company, two brands gave different advice. One said the latest accident made no difference the other that it did.

    I also discovered that my 18 year old son selling his car and going to Uni cost me £40 because having 3 cars in the household rather than 2 put the price up?

    I think this is a market ripe for the kind of 'disruption' that Amazon, Uber and indeed Direct Line (in its heyday) profited from.



  • DullGreyGuy
    DullGreyGuy Posts: 9,173
    First Anniversary First Post Name Dropper
    Forumite
    I have now shopped around and got a deal I'm happy with (from the co op).

    During my conversations I discovered that Direct Line and Churchill despite being 'partner companies' or the really one company, two brands gave different advice. One said the latest accident made no difference the other that it did.

    I also discovered that my 18 year old son selling his car and going to Uni cost me £40 because having 3 cars in the household rather than 2 put the price up?

    I think this is a market ripe for the kind of 'disruption' that Amazon, Uber and indeed Direct Line (in its heyday) profited from.
    Historically DL, Churchill, NIG, Privilege and UKI were separate legal entities owned by the same parent company. Whilst that was the legal structure operationally a single member of staff typically would work for multiple brands.

    As the regulatory landscape changed it became costly having different licensed insurance companies and so ultimately they were all consolidated into UK Insurance. This made some difference for a few back office people doing the regulatory returns etc but for your average sales person or claims handler it was an invisible change, they still deal with the product lines and brands they always did. The old companies (eg Direct Line Insurance) still exist just they are dormant and no longer licensed insurers.

    One underwriting company can play in many different markets, distribution channels, aim different brands at different customer segments etc. Underwriting rules between brands can be totally different, just makes those back office function jobs more difficult when they go out to buy reinsurance or are trying to calculate the SII capital but most would argue they are paid well enough to cope. 

    If you've got the next best idea on how to disrupt the market then I'm all ears. There are various insurtech companies thinking they can but for sales & service not seeing anything new, claims a little more improvements but historically claims based marketing has never sold well
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