One year ago I insured my little Peugeot 107 with the Halifax bank. I realize that Halifax were merely agents for another company - in this case Liverpool Victoria - but the deal was a good one. For fully comprehensive insurance, with protected No Claims bonus and me paying the first £350 of any claim (apart from windscreen repairs), the cost was £136. It even included a 'free' MOT test. Yesterday the renewal notice arrived, and this year they want an astonishing £307! That's almost double Direct Line's quotation of £161, and they were the most expensive of the rest.
You won't be surprised to learn that I phoned Halifax and cancelled the renewal. "I presume this is an unethical 'try-on'," I said. "You're hoping that your customers will simply renew without checking." The poor guy at the other end of the phone had to agree that their quotation was hardly competitive. So now I'm insured with the RAC, via the cashback site Quidco. And the price for the same cover as last year? £154, with £25 cashback from Quidco after 3 months = £129. Not bad, eh?
Despite the popularity of comparison and cashback websites, all insurers seem to hike their prices after the first year. They wouldn't try it if it didn't pay them, so it must be true that many folk renew their policies unquestioningly, on the assumption that if a company was cheap last year, they'll continue to be so. Even so, the Halifax's hike of 125% does take a bit of believing.
In a strange twist of fate, a few weeks ago I moved my home insurance to Halifax. It'll be interesting to see whether they try the same trick in 12 month's time.
Car insurance is not a factor in our lives, because of our Motability car that Mandy needs. When we did have our own car, I always found that year on year, Direct Line never seemed to change much. I could have saved 20 quid here and there when I looked around, but it never seemed worth the hassle. And now reading this, I was glad I didn't. This hike is pretty extortionate (225%?) and £307 for a 107 with £350 excess is absurd.
ReplyDeleteThat's a very good point, Lucy. Although Direct Line were not the cheapest, they weren't that much more expensive and they do have a reputation for not applying unfair price hikes. It would arguably make sense to stick with a company like that and save the hassle of shopping around every year.
DeleteOne reason is that most of the companies make you a good offer the first year possibly at cost and then try to make the profit for the two years out of the second year
ReplyDeleteJulliette
They certainly hope that you will just be lazy and let it roll over. The days of any business understanding the idea of valued customer are long gone and life is constant battle! We have all gone through this and you can but pity the poor folk on the phones who have to deal with this absurdity day after day.
ReplyDelete