Auto-Renewal car insurance vs non auto-renewal

ABN

It seems to be getting more and more difficult to get car insurancethat doesn’t come with auto-renewal.

I‘ve never had it and I understand that a lot of people are strongly against it, so trying to find out how exactly auto-renewal works.

My assumption is that they have to contact you before the renewal date to let you know the new premium and if you do nothing they will just renew it, but if you want to change insurance you can “simply” contact them and decline the renewal. In which case its not too dissimilar to nonauto-renewal, the only difference being you have to contact them to say NO instead of contacting them to say YES if you want to stay with them.

Is this correct? and is the “simply contact them” prone to difficulties?

flaneurs_lobster

It's a 'flag' that's set up when you purchase a policy. You either want auto-renewal or you don't.

Most (all?) insurers set it 'on' by default, whether you believe this is for the customer's or insurer's benefit is largely irrelevant.

You can change the status of this flag at any time during the term of the policy.

Every insurer will contact you towards the end of the policy term to tell you the renewal offer, up to you to accept or otherwise.

MyRealNameToo

https://forums.moneysavingexpert.com/discussion/6667267/auto-renewal-car-insurance-vs-non-auto-renewal

Many people are against for reasons I've never understood and I have known the dislike of it to cost people hundreds of thousands when their policy lapsed (eg they were in hospital at the time) and then a major loss occurred.

Regulations require them to give you reasonable advance notice of the renewal, most interpret this as somewhere around 21 days in advance but some are longer and others shorter. In this they must show you the new price, your old price and any material changes in terms. The law doesnt dictate how they have to contact you and most just follow your instructions so if you say email then its email etc etc

If you dont respond then yes they just renew the policy and take the payment normally just after the renewal. If you do respond then you can tell them not to renew, negotiate the price down etc etc.

The main complaints are typically that people "miss" the renewal notice, claim they never received it, that it went into their junk mail, thought it was just advertising mailshot so threw it away, they changed their email and didnt tell their insurers. At least 95% of the time the fault lays with the policyholder, obviously Royal Mail does lose some post, an insurer isnt going to simply not contact you unless there is a major IT failure. As always, put a diary note and you can contact them if for some reasons you can't find the renewal.

The second complaint is the effort it takes to cancel it, some you can do online in seconds, others its a long queue to a call centre. Personally as a once a year event I can cope with it.

Finally, particularly those that pay by DD, sometimes the payment is taken after they cancel it… 99% of those are the ones who cancel it on the day of renewal and basically DD is close to a 7 day process and they ask for the non-renewal too late. Its not a real issue, the money goes back again automatically anyway but people get annoyed with it… ideally you are deciding who you are going with at least 2 weeks before this and so can easily decline the renewal much earlier and avoid the issue.

QrizB

I see auto-renewal as a useful backstop. If for some reason I'm unable to shop around, or I forget, it means I'm not uninsured.

(An exception is breakdown insurance, where cancelling auto-renewal close to the renewal date is a pain in the neck so I always try to cancel soon after taking it out.)

Herzlos

I also don't understand the hate for it. It just means if you forget or are unable to set something up, then your car/house/phone/whatever is still insured.

I'm sure one of the insurance staff on here mentioned an incident where the policy holder was in hospital so didn't renew, the house burnt down and they were uninsured. There was also a thread on here recently about an elderly father who was unable to renew buildings insurance and the partner or child couldn't do it for them as the house was in his sole name. Both pretty horrible positions to be in that would be avoided with auto renewal.
There was also historically a lot of problems with people inadverently driving uninsured because their insurance ran out that's no longer really a thing.

It's also been a thing for years now so I don't understand how people seem to think it's new or not get how it works.

Your understanding is correct in that it's essentially the same renewal quote you'd always get, but backwards.
If you want to stick with it, you don't need to do anything else.
If you want to go elsewhere, then contact them to cancel the renewal.

chrisw

Even the online auto renewal cancellations are handy for negotiation. As soon as my son typed he wanted to stop the renewal, it came back instantly with £90 off. Annoying in some ways but dropped his annual premium to £160.

ABN

Many thanks for the replys all is clear now

forgotmyname

I use a broker that does not auto renew so they are still out there. They are also good at keeping in touch when
near the renewal so that your not accidently uninsured.

It's a club scheme which just requires find a forum that covers your car and see who they use, you don't even
need to register for the forum.

tom192

If you are the type to miss the fact that your insurance has auto renewed, you are the one that should have the auto renewal box ticked!

Far far better to have an uncompetitive renewal due to forgetting than to not be insured. Your insurance premium having to disclose no insurance for 5 years will dwarf the higher renewal in one year.

Not sure I agree with the comment about not taking it for breakdown cover as whilst you aren't going to receive fines etc again if you are the type that misses the emails for the auto renewal you will likely miss sorting out cover.

facade

https://forums.moneysavingexpert.com/discussion/comment/81990246#Comment_81990246

I just had the same with my VPN subscription, I clicked to cancel the phenomenally expensive auto renewal to take out a new subscription with a different identity at the "introductory price" and I was immediately presented with a below half price offer.

So it might well be worth leaving auto renewal on until you get the renewal quote, then cancelling it as if you were changing company. You can always accept the original offer and turn it back on.

Like others, I usually cancel auto renewal as soon as I take out the subscription/policy, now I'll try leaving it on to get the advantage of continuous cover if something unforeseen happens, in the worst case I'll just have to cancel before the policy starts for a refund.

Frozen_up_north

We have had the auto renewal on either house or car insurance come out cheaper by £90, compared to shopping around, or even going via "Meerkat" or direct to the same insurance company for exactly the same cover. As we have 2 houses and 2 cars and annual travel insurance, we don't need comparison site offers for all of those in order to get meal discounts, etc.

Depending on the offers, it can sometimes work out better value if you use a comparison site, we use Compare the Market (those irritating Meerkat advert people), and get 25% off meals and drinks (ordered at the same time as the meal) at our local pub, saving currently around £8 to £10 per couple for a meal with drinks, while we don't go every single week, sometimes there are two of us, sometimes 4, which can add up to around £200 to £300 saving in a year without much effort. It is mostly pub chains, Burger King, Pizza Express and Morrisons Cafe that have the discounts.