Car Insurance price loading

RoyBrock7898

Last year I had an excellent car insurance quote about £500 for a new car through AAIS.  This year they offered £731.08.  What is interesting is it was £1.42 less than LV.  Anyway what's with the no new customer incentive that is supposedly abolished?  I rang to cancel and 'lo, AAIS offers £600.  This is now within touching distance of several other quotes.
I got several different quotes which, when I went in to them, all ended up with Allianz at £500-£550.
Eventually I found a couple of quotes below £500 and finally went with one at £468.  It was Allianz.
When I opened the cover note it was underwritten by LV.
The LV quote through a broker was exactly £264 less than LV direct.

RoyBrock7898

In addition to my insurance tale above I want to add UK and EU breakdown cover.  As an addon to me car policy it would be an extra £98.  Returning to the broker I had used two years before the quote is £49.

daveyjp

I wouldn't worry about details.  You have taken advantage of one of the UKs most competitive markets and found a good deal.  I'm just going through similar and it appears the madness of the last few years has now subsided. 

LV is now part of Allianz so no surprise with what you found.

DullGreyGuy

RoyBrock7898 said:

Last year I had an excellent car insurance quote about £500 for a new car through AAIS.  This year they offered £731.08.  What is interesting is it was £1.42 less than LV.  Anyway what's with the no new customer incentive that is supposedly abolished?  I rang to cancel and 'lo, AAIS offers £600.  This is now within touching distance of several other quotes.
I got several different quotes which, when I went in to them, all ended up with Allianz at £500-£550.
Eventually I found a couple of quotes below £500 and finally went with one at £468.  It was Allianz.
When I opened the cover note it was underwritten by LV.
The LV quote through a broker was exactly £264 less than LV direct.

Allianz owns LV General Insurance, but not its life and pension business. They restructured a year or two ago such that LV is their personal lines provider and Allianz does business insurance.

LV sells different products directly to its customers than it underwrites via brokers and other intermediaries, if its bought direct form LV it has to include its own cost of sales in the quote whereas a broker is the one that incurs the cost of sale so effectively decides how to factor that into the price (assuming they are a substantial broker, not just a regional one who'd just get a flat percentage which they can choose to waive). 

Some brokers may have additional revenue streams, like use third party credit providers or acting as the First Notification of Loss and selling referring customers to accident management companies that pay healthy commissions. These can take the risk of lower commission on the sale of the insurance to increase the book size and therefore get more of the secondary sources. 

Despite the many protestations on this site uk motor insurance is a highly commoditised distress purchase with vast amount of competitive pressure on prices

Badboi

Happy with my renewal, even with a no fault claim mine has gone down by nearly £200

RoyBrock7898

I guess they make their money from those that don't check.  On home insurance I stayed with Sainsbury for many years despite an annual reminder to shop elsewhere.  They were always in touch with other prices and it was just not worth swapping.   They had also included a key loss tag.  There was a freephone number and promise of a £10 reward.  When we did lose our keys we got them back within 30 minutes.  Sadly they stopped doing insurance this year.

DullGreyGuy

RoyBrock7898 said:

I guess they make their money from those that don't check.  

Not any more, they cant charge renewing customers any more than they'd offer a new customer for Home and Motor. Other products they can still "walk" the renewal price.