Posts Tagged ‘insurance’
Telematics- the black box that can be fitted to cars- are already A Thing, but for most people, the decision of whether or not to subject your driving to such scrutiny is a voluntary one. However, increasingly drivers under 25 are being ‘encouraged’ to install a system or face the consequences of higher insurance premiums. But some insurers are even installing systems that will grass you up to your mum if you exceed the speed limit.
The new technology not only tracks youngsters’ every move behind the wheel, but texts their parents if it thinks they have broken the speed limit, or are braking too quickly, for example. Insurers claim this is all kosher because parents, who often cough up to fund their child’s car, have more influence over their child’s driving habits than the insurer.
“We contact parents, as well as phone call, text and update a driver’s online account if they don’t drive safely,” Crispin Moger of specialist insurer Marmalade told the Telegraph, adding “We involve parents as we don’t want young drivers to ignore messages we send them, although we can withdraw the policy if they keep driving badly.”
Other insurers will only tell parents if they have bought the policy. Steve Kerrigan of The Co-operative Insurance, who have shopped 1,500drivers for speeding since installing telematics four years ago think the system offers “reassurance to parents who can ‘see’ their children when they are out on the road and otherwise on their own.”
Some firms work by reducing premiums for drivers who agree to have telematics installed, others offer discounts for good driving behaviour, like More Than, who offer a discount of up to 2.5% after every three month review or the Co-Op who assess driving every 90 days and when the premium will either go up by 20%, or be discounted by 30%. Marmalade just slap you with a £250 penalty for bad driving as “if it was just a £10 increase then people would ignore it.”
But of course these telematics are entirely optional. You can choose to pay up to £1000 extra for a non-monitored policy. The average increase for More Than customers is around £750, and premiums are 25% higher with Direct Line than if you concede to having a black box.
But is telematics going to be forced on to the rest of us? On a purely market-led basis, the answer would be no as the eye-watering prices levied on young drivers- who are twice as likely to have an accident than the over 60s- are what makes the cost of installing a system worthwhile for the insurer.
There are cheaper options though- some insurers offer an app that can track your driving an earn you a discount, although these systems aren’t without their issues.“The difficulty with an app-based product is the potential for fraud – you could switch your phone off or give it to your gran,” said Graeme Trudgill of the British Insurance Brokers’ Association, with uncharacteristic common sense.
But chances are that we will all be driving cars with telematics in the future as from 2017, all new cars will have black boxes installed, as part of new EU targets. The “eCall” project says that, in two years, all new cars made or sold in the EU should have a telematics device that can transmit data to insurers and call the emergency services in the event of a crash.
So is this a good thing? Surely once Big Brother is watching all of us, premiums will be weighted towards those more likely to cause an accident and safer drivers will benefit from cheaper premiums. In theory anyway…
Good news for consumers but bad news for insurance companies- the FCA has today announced plans to ban ‘opt-out selling’, which is where insurers handily pre-tick boxes offering you additional products and services, over concerns that customers were paying high prices for things they didn’t want or need. A triumph of common sense.
The FCA ran a study into the general insurance add-ons industry last year, which concluded that opt-out selling often results in “consumers purchasing products that were of poor value and not what they needed.” The FCA also found that the value of general insurance products “is not always clear,” with some consumers are not even aware they have bought an add-on.
The FCA is concerned that consumers “are not able to make an informed decision on whether they need or want” the extras being foisted on to insurance purchasers. As part of the review, the FCA also wants firms to provide consumers with “more appropriate and timely information” to help them identify if they even want an add-on at all, and if so, which is the most appropriate and most cost-effective option for them.
The FCA plans to introduce guidance encouraging insurers to raise the issue of the most common add-ons to consumers earlier in the sales process, while also making it easier to compare alternatives, specifically recommending that firms provide the annual price of add-ons rather than just giving the smaller monthly figures in a shameless attempt to make the overall cost look smaller.
Christopher Woolard, Director of Strategy and Competition said, categorically, “this is about ensuring consumers can make the right decision on what add-on insurance they do or don’t need. Forgetting to un-tick a box at the end of a purchase is not making an informed choice.”
“Our work shows that the opt-out model means too often consumers are buying a product when they have not been able to give any thought to whether or not they need it,” he continued, citing the familiar example of consumers having to double check whether or not they have accidentally agreed to buy an add-on insurance product when buying car insurance or tickets online, for example.
“These proposals will mean that consumers will be in a better position to decide what they want and consider the options available to them. Fewer consumers will end up with products they didn’t want or don’t even know they own,” he finished, with a flourish.
The proposed ban would apply to any add-on sales of regulated or unregulated products offered alongside financial primary products, which would include the almost industry-standard add ons of legal expenses sold with home or car insurance, breakdown or key cover sold alongside motor insurance, or protection cover when taking out a mortgage or credit card.
The consultation period ends on 25 June 2015.
Of course, we’re being sarcastic and whiplash claims have, according to a report from one insurer, hit record levels.
The result of all this is that on average, motorists are getting £93 added to their motor insurance premium. So, thanks to people with no neck ache, everyone else is paying for it. Nothing new, but galling all the same.
So what’s brought these new levels about? Well, once again, we can thank the no-win no-fee law firms who have been drumming up business on daytime TV and doing very well for themselves.
Aviva reckons that, despite the best efforts of the government to sort out compensation culture and lower motor insurance costs, more needs to be done if there’s going to be any reduction in whiplash claims. According to their figures, whiplash is costing drivers as a whole, £2.5bn a year. Their research also showed that the UK is on course to bring in advance of 840,000 motor injury claims to the Claims Portal, which allows insurers to submit claims, for the year ending April 2015.
Last year, 80% of motor injury claims included whiplash. Compare that to France where it only makes up 3% of injury claims, and you can see that something’s awry.
The PPI debacle has become one of the most shameful episodes in British banking of the last ten years. And there’s quite a range of knobbery to select from.
A whopping £17.3 billion has now been paid out, after PPI was ruled to be an utterly despicable piece of mis-selling, often with no actual thought as to whether the customer could pay it back or not.
Payment Protection Insurance or PPI, was meant to protect borrowers in the event of sickness or unemployment, but were often sold to those who would have been ineligible to claim.
The Financial Conduct Authority (FCA) said it would use its findings, due to be published in the summer, to assess if the current approach to compensating customers is working properly. Because there just hasn’t been enough money squandered on this.
The FCA said in a statement: “The FCA will then consider whether further interventions may be appropriate, which could include a consumer communication campaign; a possible time limit on complaints; or other rule changes or guidance, or whether the continuation of the PPI scheme in its current form best meets its objectives,”
“While this work continues, the FCA expects firms to continue to deal with PPI complaints in accordance with our requirements,”
Banks such as Lloyds, Barclays, HSBC and Royal Bank of Scotland have already set aside £24 billion to compensate consumers, with many of them wiping off the entire debt of customers
Since 2011, the banks have dealt with over 14 million complaints about PPI, and have got to around 70% of customers paid back.
There’s still around 4,000 complaints coming through the banks each week about PPI, so even if you have the slightest doubt, get in touch with them.
Honestly, you can’t trust anyone these days.
On the back of Nationwide’s existing-customer-only top mortgage deal yesterday, now calls are out for the FCA to investigate motor insurers save their best rates for new customers to the detriment of loyal drivers.
Speaking to the Insurance Times, Ian Hughes, Chief Executive of Consumer Intelligence, questioned the practice of offering discounted premiums to new customers but not to existing clients. “Is it a fair outcome that a customer that has been with you for six years could, for instance, get a premium that is half what they are currently paying if they were a new customer?” he asked, plaintively.
Mr Hughes is firmly on the side of the fence that says it is not fair, calling on the FCA to examine new business discounts as part of its focus on ensuring fair outcomes for customers. And he’s got a point, particularly as changing insurer every year is more difficult for certain groups of consumers.
But he doesn’t take the soft option and blame the comparison sites, as after all, that’s the way many people seek out the lowest renewal premium. Hughes lays the blame squarely at the door of the insurers themselves:
“A lot of people try to put the blame at the door of price comparison sites, but they are not to blame for this problem. This problem is created by introductory discounts – by giving your best prices to your least loyal customers.”
However, despite calling for FCA intervention, what Hughes is really hoping for is that the insurance industry will see the error of its ways and change policy before being forced to act by the regulator.
He said: “It is always my hope that the industry can be grown up enough that it can recognise and fix its own failings. When a regulator has to step in, nine times out of 10 that creates issues and challenges all of its own.”
But are the insurers really going to change? Surely it only needs one pioneering insurer to set the ball rolling in the looking-after-existing-customer stakes? Unfortunately not. “The problem is that if any one company starts to try and address the problem then, unfortunately, they will lose a lot of business,” warns Hughes. “No one company can fix this by themselves. It needs to be corrected as an industry and that is a big challenge.”
So is a self-correcting insurance market just pie in the sky? Looks like we will have to wait for regulatory interference before we can all stop chasing new deals every year. Besides- if your insurer told you they were changing strategy and were offering you, their existing customer, their best prices, would you believe them anyway?
Car insurance is compulsory, so once a year you have to find the spare cash to insure your car for another year (making sure you shop around at that time to find the best deal). In recent times, of course, it has been possible to pay for your insurance monthly, convenient for people paid monthly, but it seems that some insurers are trying to cream extra profits out of poor instalments payers- by charging extra on top of additional interest charges.
In an ideal world, insurance companies would allow you to spread the cost of your annual insurance over the months you use it free of charge. Unfortunately these are insurance companies we are talking about, so there is generally an interest charge for spreading the payments- although it’s always worth checking what this is, as the rates can vary wildly between providers. However, a new Which!!! investigation has discovered that, in addition to interest charges, some insurers are charging monthly customers more just because they can.
The offending insurers are the Admiral group of companies, which includes the Elephant and Diamond brands, who are using this double-dip approach to effectively charge monthly customers twice for paying monthly. By comparing the annualised monthly and the one-off annual insurance cost on a number of vehicles, Which!!! found that the difference could be as much as £145.
The examples found by Which!!! include a quote with Elephant.co.uk for a 25-year-old Toyota driver, where the annual premium was £594.66. Without including a charge for interest, however, when selecting a pay monthly premium, the cost rose to £642.36. Interest was then added on top of the inflated premium, bringing the full cost over a year to £702.35. That’s £108 more for paying monthly.
Of course, the insurer would never admit to charging people more for anything. Instead what they are actually doing is offering single-payment customers a ‘discount’ from the standard price. Of course they are. Which!!! found that these ‘discounts’ varied considerably depending on the scenario and insurer. For the Toyota driver above they ranged from £44.52 to £47.70, while for a 30-year-old Audi owner they were as little as £2.12 with Diamond and Elephant, and £8.48 with Admiral. In the worst case, Which!!! found a difference between one-off and monthly premiums of £145.22 on a quote for a Ford Focus Zetec, insured with Admiral.
Which!!! say they “don’t think [insurers] should be attempting to make a second profit on customers” who don’t have the funds, or who simply choose to pay their premiums monthly. We agree, although capitalist society can’t blame the insurance companies for trying. What’s clear is that if you do check quotes at renewal, you are likely to find a cheaper monthly premium by selecting an insurer who doesn’t bump up the prices.
Admiral declined to comment owing to “commercial sensitivity.”
No-one likes insurance companies. Not even their mothers. So how can insurance companies make themselves even more odious? By engaging in the severely-frowned-upon practice of making abandoned or ‘ghost’ calls to older adults, that’s how.
Specialist over-50s* insurer Ageas was investigated by telecoms regulator OfCom who found that they made 148 abandoned calls over three separate days during a seven-week period of investigation. This breached the maximum of 3% of all calls made and the company was fined £10,000 for their misdemeanors. That’s almost £70 per wasted call.
Nevertheless, Ofcom considers this to be a small fine, as it considered the “degree of seriousness and harm to consumers was at the lower end of the scale.” Ageas was found to have been in breach of legislation relating to “persistent misuse of a telephone network or service.” The fine also reflects the company’s offer of a £10 shopping voucher to affected consumers and the steps it has taken to bring itself into compliance. Presumably by ceasing and desisting.
Claudio Pollack, Ofcom’s Consumer and Content Group Director, said: “The law is there to protect consumers from suffering annoyance, inconvenience or anxiety, including from abandoned calls.”
“Organisations using call centres must comply with the law or face the consequences. Where we find breaches, even at the lower end of the scale, we can take action” he finished.
However, Ofcom itself is not finished, as it has also announced a review of its ‘persistent misuse’ policy.
The existing policy identifies silent and abandoned calls as two examples of misuse, although we are sure that Bitterwallet readers could come up with many more examples. Ofcom’s policy also describes steps organisations can take to avoid making them and how to reduce consumer harm where they do occur.
However, Ofcom want to know if this could be better and is asking for initial views on what, if any, changes could be made to:
help make enforcement more efficient and effective;
reflect technological developments or other changes in the call centre industry; or
clarify the policy to make it easier for companies to understand and follow. We don’t think “stop bothering people” is particularly hard to understand, but perhaps you have some simple suggestions on how to reinforce this message. To idiots.
Responses need to be submitted to Ofcom by 7 November 2014.
*that’s older than I am
Things are getting shaken-up in the world of car insurance. Does it mean cheaper car insurance for all? Of course it doesn’t. Did you have glue for your breakfast this morning because that’s a stupid thing to think.
Basically, the Competition and Markets Authority (CMA from now on) have said that exclusive pricing deals between motor insurers and price comparison websites need to be banned. Basically, because of these deals, insurers are being denied the chance to make their products available for cheaper, elsewhere.
The CMA also noted that consumers need better information on no-claims bonus protection insurance.
This review came about after the Office of Fair Trading asked the CMA to get stuck into the motor insurance market, and after a year of weighing things up, this is what the CMA have come up with.
They say that, because of the deals being struck between insurers and price comparison websites, it is pushing the price of premiums up across the board.
“They certainly help motorists look for the best deal, but we want to see an end to clauses which restrict an insurer’s ability to price its products differently on different online channels,” said CMA deputy panel chairman Alasdair Smith.
The CMA also tossed some work to the Financial Conduct Authority who should be examining how insurers tell consumers about add-on products to car insurance policies and the like.
“The way motor insurance-related add-on products are sold makes it hard for consumers to obtain the best value,” Smith added, with no-claims bonus protection being a particular concern: ”We are requiring insurers to provide much better information.”
Alas, the CMA said that they weren’t able to work a way around the problem of high car hire and repair charges for drivers who were not at fault in an accident.
Fixing that, they say, would require a “fundamental change in the law”.
Sensible travellers know that, when you go abroad, in addition to your EHIC if travelling in Europe*, you make sure you get travel insurance with medical cover because, after all, anyone can have an accident. However, the Financial Ombudsman has noted a growing trend for insurers to refuse to pay out at all if there has been alcohol consumed – even if that is as little as two or three drinks.
While travel insurance cases make up only 2% of the Financial Ombudsman’s work, insurers seems to be getting cheekier with the amount of cases upheld by the Ombudsman rising from 42% to 53% last year. And many of the cases involve a denial of relief, owing to alcohol consumption.
The reason many health claims on travel insurance are denied is because of undisclosed previous medical conditions, and failure to inform an insurer of alcoholism could fall under that category. However, the Ombudsman is now seeing cases denied on the grounds of “alcohol abuse” or “excessive alcohol consumption”, terms which are often undefined and therefore open to the insurer’s interpretation.
Some examples given by the Ombudsman include a woman who needed stitches after banging her head on a bedside table whilst on holiday in Greece. She freely admitted to having drunk two or three drinks over the course of the evening, which rendered her blood alcohol level over the legal limit for driving in the UK. The insurer claimed the injury was as a result of excessive drinking, although they had not defined what ‘excessive’ might be. The Ombudsman felt that two or three drinks over a long evening whilst on holiday and not intending to drive was not, in fact, excessive, and that “people can be clumsy and have accidents even when they’re sober.”
They also found that insurance companies make assumptions, based on age and location. A young man in his twenties was admitted to hospital after collapsing while out at a popular European resort. The reason assumed by the doctor was given as alcohol consumption, so the insurer rejected the claim for medical expenses on the grounds that they had arisen “directly or indirectly from using alcohol”.
However, the Ombudsman does not think it is reasonable for any insurer to assume people will not drink at all on holiday, so the onus was to show whether the admission was caused by alcohol, not merely incidental to it. The medical evidence showed that the young man in question had, in fact, drunk less than the UK driving limit on the night in question, and that an alternative explanation for his collapse could have been down to dehydration. His claim was upheld.
Although, ideally, insurance companies would just settle reasonable claims, it is important to know that the Ombudsman requires the insurance company to prove that an exclusion applies (eg for excessive alcohol consumption), it is not down to the traveller to prove it does not apply. But nor does the Ombudsman uphold every case. Cases that have required hospital treatment to treat alcohol withdrawal were upheld in the insurer’s favour, as the claim clearly resulted from alcoholism notwithstanding the fact that no alcohol had been consumed on holiday. Another case where a traveller sadly died while falling down the stairs was also found in favour of the insurance company when post mortem tests showed blood alcohol levels were sufficient to have caused “severe ‘ataxia’ (problems with balance and coordination) and poor judgement.”
So next time you get blasted on holiday, check your policy exclusions and make sure you don’t injure yourself, or those fishbowls could end up costing more €uros than you thought…
*European Health Insurance Card, previously known as E111. Link to get a free card for the uninitiated is here
If you work in the healthcare sector, you are most likely to be ‘at fault’ for a car accident, according to new research. MoneySuperMarket analysis of over 11 million car insurance quotes has worked out the top ten professions in the UK that make both the fewest, and most, ‘at fault’ claims on their car insurance policies.
Skilled and careful, surgeons are the ones to trust with your bypass, so long as it’s not an A road, as they top the list of those most likely to make an at-fault claim, followed by healthcare colleagues GPs, health visitors and hospital consultants. Suggestions are that healthcare is a demanding and stressful job, thereby leading to more accidents outside of work- the only job outside of health care in top ten is that of probation officer, which seems to support this theory.
However, the table of the ten professions least likely to have an ‘at fault’ claim is more varied, but includes a number of positions ending in clerk, suggesting that administrative roles are less likely to stress people out so much that they crash their car. The list includes building society clerks, typists and funfair employees as being the safest drivers in the UK.
Kevin Pratt, car insurance expert at MSM, said: “It is really interesting to see how much one industry dominates the top ten claims table – it seems those who have the responsibility of saving our lives and caring for our health are the most accident prone drivers. There is no doubt that surgeons, GPs and health visitors are all stressful jobs, so lack of time or tiredness could mean that these drivers are more likely to make an ‘at fault’ claim.”
“Being involved in an accident, no matter how minor, whether you’re at fault or not, can be a traumatic and costly experience. Our research shows the average claim value for an ‘at fault’ accident is nearly £3,000 and claiming for either ‘not at fault’ or ‘at fault’ accidents will drive up annual premiums, typically adding around £33 on average.”
But what good is this to you if you are a healthcare worker? Well, a little while ago, we investigated the cost saving benefits of changing your job for car insurance purposes. We weren’t advocating lying, of course, but if your job could genuinely fit between a couple of definitions, why not go for the one that gives you cheaper insurance- like being a nanny instead of a childminder, for example. And if you could legitimately be described as a packer, a picker or a typist , why not see if it’s also safer on your pocket to be one?
We all know that switching is often a valuable pastime. Switching banks, energy providers and insurers is all the rage these days, as everyone knows you only get the best deals by being totally disloyal.
Or perhaps everyone doesn’t know. New research shows that over half of UK adults haven’t switched any of the 10 most common financial products in the last 12 months and that estimated 10 million consumers (21%) have never switched anything.
Gocompare.com surveyed just over 2,000 UK adults, was commissioned by comparison website Gocompare.com, and revealed that in the last 12 months:
“More people switched car insurance (16%) than any other financial product, but 30% have stayed with the same car insurer for over three years
Despite rising energy prices and energy switching being all over the news and the interwebs, only 15% had changed provider to get a better deal, with a massive 60% having had the same energy provider for over three years.
13% had switched their home insurance, but less than ten percent of responders had switched their current account (7%), their credit card (5%) or their mortgage (2%) in the last year.”
It was a similar story for the never-switchers. The charts of never switched products is topped by bank accounts at number one, down to car insurance at number ten. The full list is:
1. Bank accounts (35% never switched)
2. Mortgages (28%)
3. Broadband (25%)
4. ISA/savings (24%)
5. Landline phone (23%)
5. Mobile phone (23%)
7. Credit card (22%)
8. Energy supplier (16%)
9. Home insurance (14%)
10. Car insurance (12%)
The lack of switching is surprising given the survey also asked whether consumers felt better or worse off than they did a year ago. Almost a third (29%) of UK adults say they feel worse off now compared to a year ago, with 17% admitting that they are seriously worried about the state of their finances. Around half (54%) said things were about the same.
Claire Peate, customer insight manager at Gocompare.com, said: “While many people have become committed comparers, switchers and savers – our research suggests that millions could still be paying more than they need to by sticking with their existing providers. But, in our experience, a common reward for loyalty is a higher price. So shop around for the best deals and if your existing provider seems expensive, switch.”
But should we really bother with the people who never have, and in all likelihood, never will switch? Doesn’t that leave better deals for the rest of us who can be bothered to shop around?
The future of the Association of British Insurers is an uncertain one after one of the main players in it – Legal & General – decided to go solo. L&G decided that it would be in the best interests of shareholders and policyholders if they cancelled their membership.
A few weeks ago, the company said that they wanted the trade body to be “a more forward-looking organisation”, so it isn’t too much of a surprise.
Nigel Wilson, Legal & General’s chief exec, said: “Our public policy work increasingly involves sharing commercial aspects of our business with government, which, for very obvious reasons, not least competition law, we cannot share with competitors.”
“We believe that, increasingly, engagement with government, regulators, quangos and other external bodies will be on a case-by-case basis going forward.”
The ABI have been having a rough time lately as it is, with the insurance industry looking at huge regulatory changes, which include reforms in the last Budget which promised structural changes to the insurance sector.
For the time being, Admiral and Allianz have no plans to ditch the ABI, and it looks like Axa will be sticking with it for the foreseeable future. Aviva and Prudential haven’t given their thoughts on the matter, but if Legal & General start making serious money and having more freedom, are we going to see the insurance equivalent of a Premier League breakaway where they can all start calling the shots more frequently?
Would that be good for consumers? It could go either way.
They’ve said that the recent fall in premiums may be ending, even though regulatory efforts have been trying to bring them down even further.
Admiral’s chief executive, Henry Engelhardt, said: “In the UK there are some signs that premiums are no longer falling but we have yet to see firm evidence of an inflection point and a return to premium growth.”
“Admiral’s premium rates have been pretty flat over the first half of the year, though as a result of the reductions in 2013, total premiums are down around 9% compared with the first half of 2013.”
You see, insuring your car has been a little cheaper since the Government and industry got together and started to come down hard on fraudulent claims (we’re looking at you Mr I Got Whiplash After Someone Took My Wing Mirror Off And I Gasped A Bit Harder Than Usual). With a decline in claims , premiums went down with them.
The Competition and Markets Authority (CMA) proposed imposing a cap on replacement vehicle costs too, which would be passed on to the at-fault driver following an accident, as well as wanted to ban price parity agreements between price comparison websites and insurers.
However, it looks like Admiral & Co have found a way of milking more money out of drivers.
The mid-nineties were dark days. Not just because of Peter Andre and East 17 but also because those were the shady times when building societies forced you to take out their own buildings insurance policies when you had a mortgage with them- at a healthily inflated premium of course.
But in the face of a sledgehammer of legislation to tackle the problem, the practice was dropped, and in today’s more enlightened times, new buyers are free to shop around, using any one of the multiple comparison sites around to secure the best deal on home insurance.
However, there is still an issue for homeowners. Last month comparethemarket.com (the one with the rodents) calculated that, for the‘significant number ‘of people, who have not switched since taking out their home insurance under sufferance through their original lender, they could have saved ‘legacy losses’ totalling around £2.2bn – an average of £1,446 per household over the last 20 years.
Additionally, the cheeky anthropomorphic creatures discovered that some building societies, mostly smaller regional ones, are still levying a penalty charge of up to £45 if you choose not to take out their overpriced insurance.s
Sounds a bit rum. Of course, the building societies can’t actually charge you for not buying their products, that would be madness. What they can do, however, is charge you an administration fee for requiring sight of your alternative insurance provider to ensure that it is, in fact, bona fide. Unlike the admin charge itself.
The comparethemarket.com research found Ipswich building society to be the worst offender in a list of 18 lenders which charge home buyers for daring to choose a cheaper insurance provider.Ipswich charges £45, but out of the other charging lenders, the largest is Skipton, which charges £25.
Simon McCulloch of comparethemarket.com said, based on the mortgage and remortgage market share of those lenders that impose a fee, consumers are collectively paying nearly £2m a year for these charges.
“These charges are essentially a tax on being financially proactive and prudent,” he said. “Shopping around for buildings and contents insurance saves a third of UK households more than £100, which could, for example, pay for your first six months broadband after you move house. But charges like these are designed to put people off doing this and, in many instances, to tie them into more expensive products.”
A spokesman for the Ipswich said: “The society has recently conducted a review of the ‘own insurance’ mortgage fee. The result of this is that we intend to remove this fee for all applications from 1 September 2014.”
A Skipton spokesman said: “There is a charge we make to ensure that if someone buys their buildings insurance elsewhere, we need to check that the property is properly insured.”
And yes, I know they are mammals.
Two out of three people are incensed about paying the sneaky charges hidden in the small print of insurance policies. It’s becoming a thing now to insert charges for cancellations or amendments to your policy and consumers are NOT happy.
A Which!!! survey revealed that nearly half of insurance firms have increased admin fees in the last few years – fees that have no real basis in reality, like a £20 charge to set up a policy or get copies of documents.
So why all the secret fees and subterfuge? Well, it’s those goddamn comparison websites, innit?
Insurance companies want to keep those all important headline fees down, so they have to spread the actual cost somewhere else. It’s also happening with mortgages, credit cards and bank accounts. In fact, it’s like the whole world is turning into Ryanair.
And we’re getting wise to it, too. 68% of those surveyed said they were aware of the manipulative trickery that companies employ to keep headline costs down.
Hit it, Ricardo Lloyd-o! “Consumers are fed up with being hit with unexpected, additional costs for financial products that lead to them paying more than they bargained for. These fees can be hard to avoid, and people often don’t know what they’re really paying for.”
“We want the financial services industry to stop sneaky fees and charges, and put an end to excessive, unclear and hard to compare fees that do nothing to improve the low level of trust in these markets.”