Car Insurance Renewal - Price Increase of 36% - No Changes

[AsleepInYorkshire]

Hi Fools,

I've received an email this morning from my car insurance company. I've been with them for 7 years now. Nothing has changed since last year, except my car is a year older. The new price, which I haven't agreed to pay, is 36% more than last year.

I'm with Churchill.

I thought I'd ask, before I invest my time in finding other quotes, if other Fools have seen similar increases in their premiums?

Also has anyone any recommendations for online brokers please?

Thank you advance.

AiY(D)

[Laughton]

Last year I paid £273.33 (fully comp for me and my son as drivers incl protected NCD, Legal Expenses and Personal Accident).
This year's quote was £285.50 which I thought was more than reasonable so I renewed.

Normally I use one of the comparison sites (go.compare, confused.com, moneysupermarket.com - other sites may be available) just to double check that I'm not being ripped off but unless I can make a decent saving I'm happy to stick with existing insurer.

[y0rkiebar]

There was a segment on one of the news programmes yesterday about rising insurance costs. Advice was, as usual, shop around, with the optimum time to obtain quotes being 21 days from renewal.

[Adamski]

Both myself and Mrs A swop car insurance every year using compare the market. Its the only way to keep the price the same. The insurers like banks rely on inertia to maximise profits.

[BullDog]

I am expecting this. Last week my house insurance renewal increased by 40% compared to last year. Bad news is that shopping around was even more expensive. In the end I renewed but only after calling them and tweaking the cover to mean I'm only paying about 25% more than last year.

[pje16]

With Aviva, mine in May this year was £560, last year was £440, but 2 years ago it was £480, so £80 increase over 2 years isn't too bad
by the way last year when it was £440 comparison sites showed £700+
I am in NW London with a BMW 220, full no claims

[daveh]

Yes my car insurance was well up this year with Direct Line. Generally it had been at around £200-250 pa for a number of years. It went up a bit last year (into the £300s) and a lot this year to £472. It was/is on auto renewal and I didn't have time to do a comparison, but next year I'll have a look at NFU and see what they can come up with and on the comparison sites.

For info a Skoda yeti Outdoor 4X4, 6 years old fully comp one driver (me).

Must remember to cancel RAC as I now have 2 years cover from Skoda as went with there all in deal for £35 a month for 2 years servicing, 2 MOTs, 2 years roadside assistance and 2 years warranty. My calculation suggests I'll be about breakeven if I cancel the RAC compared with paying for the servicing etc myself and the warranty is then thrown in free and the car is getting to the age when it might start needing repairs.

[DrFfybes]

Both myself and Mrs A swop car insurance every year using compare the market. Its the only way to keep the price the same. The insurers like banks rely on inertia to maximise profits.

AIUI it is now illegal to offer existing customsers worse terms than new ones, so what is more likely is something about the OP's vehicle age, personal age, postcode, employment, or vehicle type has put them in a less desirable demographic.

I am expecting this. Last week my house insurance renewal increased by 40% compared to last year. Bad news is that shopping around was even more expensive. In the end I renewed but only after calling them and tweaking the cover to mean I'm only paying about 25% more than last year.

Wow - I thought our 25% was bad. Shopping around got us a much lower price, and the best price was with the same insurer. Until I read the details and once I'd added in the elements stripped out by the budget quote it came back to the new price

Paul

[Laughton]

As an aside (but sort of connected), my RAC breakdown came up for renewal last week. They wanted to charge me £167 vs £127 last year (three drivers/two cars). I phoned them and told them not to auto-renew as it was too big an increase in current circumstances and I'd have to look around for alternatives.

They immediately offered to lower cost to £158 but make it for 15 months instead of 12. Pretty sure that's the same as last year so I was happy to renew (and I'm guessing the chap on the other end earned himself a bit of commission for retaining a customer).

I know there are other providers out there but some of them don't like the fact that one of our cars is over 30 years old

[bungeejumper]

Seven years with one insurer must be some kind of a record. I'd be surprised if the OP hasn't been paying a loyalty surcharge for some years now? Last year's increase from my existing insurer was trivial (£20), so unusually I stuck with it, but normally I'd have been off to the meerkat as a reflex action.

In their defence, I suppose the insurers do have reasons for upping their premiums. We're all driving more miles post-lockdown, and then there's inflation, and then there's the increasing complexity of cars. Not forgetting the sharp rise in the values of used cars, caused by the holdups in new car deliveries. Even the cruddiest old car is worth more at write-off time, and the insurers have to cover all that.

Some interesting statistics at https://www.uswitch.com/car-insurance/c ... tatistics/

In the third quarter of 2022, the average premium paid for private motor insurance was £436... The average cost of repairing vehicle damage under a policyholder’s own motor policy increased 16% to just over £3,000 from Q2 2022. This can likely be attributed to the creation of more sophisticated vehicles that require more expensive repairs, the continued shortage of semiconductor microchips, and other global supply chain issues in the wake of Russia’s invasion of Ukraine.

The latter issue has led to longer waiting times for new cars and parts which have resulted in used car prices rising by an average of 30% in 2021, according to Autotrader. This is another potential factor in the rise of average car insurance costs for customers.

And yes, apparently electric vehicles have 50% more road accidents than other cars, according to AXA, and they cause more damage both to themselves and to other vehicles because they're faster and heavier (https://www.brusselstimes.com/287315/el ... tudy-shows). But shhhhh, eh?

BJ

[AsleepInYorkshire]

Thank you for all the replies, greatly appreciated.

I've just completed a questionnaire with Meerkat and got some quotations in.

I've adjusted the details of cover a little, but nothing that would substantially change the premium.

OK ... time for the facts

My existing insurer, Churchill quoted me £479.55 for this years premium. This was up 36% on last year.

The cheapest quote on Meerkat is from Darwin Friends of Churchill which is £232.99 (kinell )

The next best is price is ... you couldn't make it up, Churchill Essentials ... £246.55

I am only doing about 5,000 miles a year.

All's well that ends

AiY(D)

[Dod101]

Just remember in all the shopping around to find the cheapest insurance quote that the most important bit of it is if/when you need to make a claim. I have commented on my (happy) experience with Direct Line. I doubt that they are the cheapest in the market but their claims handling is excellent in my experience.

Dod

[marronier]

You realise that your motor insurance premiums are loaded with a subsidy to reduce the premiums of offenders such as DUI , drug users and 12+ point recidivist transgressors ,whose insurance would otherwise be unaffordable were they charged with the full cost premiums of their activities. No wonder an increasing hard core cock-a-snoot at the traffic laws.

[scrumpyjack]

Yes, I had my renewal quote the other day from Admiral for my two cars and it had risen from 761 to 1,221 (after 23 yrs NCB)
I rang them and they immediately offered £230 off 'discount'! I have been with them for many, many years.

I used Moneysupermarket.com to look for alternatives and eventually went for Aviva at £784. There were cheaper quotes but I wanted to go for a reputable company I had heard of!

[Spet0789]

Aside from the usual game of insurers putting their prices up, the cost of claims has apparently shot up. Repairs are more expensive and owing to parts shortages (globally but particularly bad in the U.K.), lots of insurers are having to pay for hire cars while the damaged vehicle is off the road.

And even if your car is a clunker, of course they have to price to reflect the risk that you hit an expensive car and they have to fix it and replace it pending the repair

[AF62]

Both myself and Mrs A swop car insurance every year using compare the market. Its the only way to keep the price the same.

The problem with doing that is every other year the car isn’t owned by the main driver and the main driver isn’t the person who’s name the policy is in - all of which can have an impact on price.

AIUI it is now illegal to offer existing customsers worse terms than new ones

Not quite correct.

Insurers are not allowed to offer different prices to new and existing customers that came to them by the same route.

So they can offer a different price to a customer that came via a comparison website to one who came via their own website (and every other permutation you can think of).

And so shopping around is still vital.

Aside from the usual game of insurers putting their prices up, the cost of claims has apparently shot up. Repairs are more expensive and owing to parts shortages (globally but particularly bad in the U.K.), lots of insurers are having to pay for hire cars while the damaged vehicle is off the road.

And with lots more BEVs on the road, the insurance companies are finding that when their customers driving ICE cars hit a BEV then the cost of repairing the BEV (for which the ICE driver is responsible) are eye watering, so pushing up the cost of insuring ICE cars even though northing has changed for the ICE owners.

[Watis]

Both myself and Mrs A swop car insurance every year using compare the market. Its the only way to keep the price the same.

The problem with doing that is every other year the car isn’t owned by the main driver and the main driver isn’t the person who’s name the policy is in - all of which can have an impact on price.

AF62 - if that's what's being done, you're right.

My take is that Mr & Mrs Adamski each have their own car and each use Compare The Market to get the best price for their own insurance cover.

Perhaps Adamski could enlighten us?

Watis

[AF62]

Perhaps Adamski could enlighten us?

Agreed.

It was the use of the word “swop” rather than the use of the word ‘change’ that led me to believe what they were doing.

[Dod101]

You realise that your motor insurance premiums are loaded with a subsidy to reduce the premiums of offenders such as DUI , drug users and 12+ point recidivist transgressors ,whose insurance would otherwise be unaffordable were they charged with the full cost premiums of their activities. No wonder an increasing hard core cock-a-snoot at the traffic laws.

Anyone should realise that. That is the basic principle of insurance but at the same time, insurers will differentiate their quotes to reflect the perceived risk for one driver and the car driven against another, where it is kept and so on. Otherwise it would be very simple to underwrite. One charge for all and for many, much higher premiums than for now.

Dod

[Lootman]

You realise that your motor insurance premiums are loaded with a subsidy to reduce the premiums of offenders such as DUI , drug users and 12+ point recidivist transgressors ,whose insurance would otherwise be unaffordable were they charged with the full cost premiums of their activities. No wonder an increasing hard core cock-a-snoot at the traffic laws.

I thought that was what the "Any Driver" policies were for? Because then you do not have to name a driver who has been banned or who would otherwise drive up your premium.

At some point the "Any Driver" policy might actually be cheaper than naming bad drivers on your policy.