LV Car Insurance renewal

[Dixonator]

Hi everyone,

 

Quick query regarding renewal of my car insurance.

 

The renewal happened at Christmas time. Busy time as any, but of course I will be told I should keep on top when the renewals occur. Typical excuse, didn't receive written confirmation of the renewal quote. Only thought something wrong when I checked my January statement to find the premium had gone up.

 

Call LV, they confirm the amount. I then tell them I have just run my car details and produced another quote on their own website. Guess what, it came up cheaper. When I asked why they would do this to me when I had no claims for the last year with them, or the other 3 with my previous company, phone went silent, they went off to talk to their people. Came back and said they would cancel the renewal and waive the cancellation charge - only if I renewed with them.

 

Please correct me if I'm wrong, but why would they backtrack so quickly and cancel the renewal without charge if they had not made a mistake? I printed PDFs of the online quotes so I have them as evidence too. However I just need a bit of guidance from you knowledgeable people.

 

Have they imposed unfair terms on me by inflating the true renewal cost of my insurance? Is the contract still binding if they make an error of this kind? It works out at another £200 per year; not small change by my book.

 

They have written to me on Monday, but still nothing, and again today. They also said they would call to discuss later today. I said how can I discuss anything you can't show me in writing?! They said they'll 'see' if it is at all possible to email me.

[unclebulgaria67]

Insurance rely on inertia ( lazy or busy) policyholders just allowing their policies to be automatically renewed. It is up to the policyholder to get alternative quotes at renewal and to take relevant action to get the cheapest Insurance for them.

 

All Insurers tend to offer discounts to new customers, which they don't offer to their existing renewal customers. You just have to be alert when the renewal is due, by getting quotes, cancelling the existing policy and arranging a new one, sometimes with the same company.

 

Not much you can do about it. Your current company may just agree to allow you a policy for the year at the new policy price you have obtained from them.

[Dixonator]

But surely if they have inflated the price over and above what it should be, then haven't they created an unfair price even by their own calculations?

[unclebulgaria67]

But surely if they have inflated the price over and above what it should be, then haven't they created an unfair price even by their own calculations?

 

Yes the all do. It is a rip off, but what can people do about it. The OFT are already looking into the way the Insurance industry works.

 

I have seen it from the inside. The people who do the rating of policies, are often pressurised into finding ways to offer new customers cheaper premiums, so the company sells more policies. One way that they can do this, is by increasing existing policy premiums in a way that hopefully does not cause too many policyholders to cancel and go elsewhere. You then end up with potentially a big difference between new and existing policy premiums.

 

It is the same with everything. Shop around when you can and move your business somewhere else if you need to. There is no such thing as loyalty anymore.

[Dixonator]

Yes the all do. It is a rip off, but what can people do about it. The OFT are already looking into the way the Insurance industry works.

 

I have seen it from the inside. The people who do the rating of policies, are often pressurised into finding ways to offer new customers cheaper premiums, so the company sells more policies. One way that they can do this, is by increasing existing policy premiums in a way that hopefully does not cause too many policyholders to cancel and go elsewhere. You then end up with potentially a big difference between new and existing policy premiums.

 

It is the same with everything. Shop around when you can and move your business somewhere else if you need to. There is no such thing as loyalty anymore.

 

So, the contractual terms are fair, even though they have knowingly inflated their own website price? I don't see how the courts would find in favour of such practice. What happens if I take them to court myself for the difference? Small claims, use MCOL, £40, make them spend a bit of money. From past experience, the magistrates have always quite liked it when I went up against a larger organisation's legal team (I say always, only really 4 or 5 times).

 

Also, I remember reading somewhere that I can have them investigated by a regulatory body. This costs the insurance company almost as much as my premium to comply with. Any ideas who that would be? I don't think it is the FOS.

[Dixonator]

Also, how can they tell me they will waive the cancellation charge, ONLY if I stay with them?

 

Either they are willing to waive it or not. And if they are, then why should whether I stay with them or not impact the situation. They admit it was wrong, but will sting me if I go.

[unclebulgaria67]

Up to you to pursue you as you want to. Most people would not bother due to cost and time. Not sure what case you would make in court.

[manofmystery]

Trouble is with motor insurance is they never make money on the first year, only the second and third. (advertising, admin, call centre costs etc etc) so they bump the price of renewals up, so that people just renew without thinking. But they keep new business low because of the highly competitive market.

 

What they've done isnt illegal, morality is questionable, but not illegal. You let the policy renew by omission (not telling them to not renew it) and are now bound by their terms of cancellation.

 

By the same fact of why you said to take them to court is why they wont discount it - if they discount your policy to their renewal price, why dont they do it for everyone? (Treating Customers Fairly - as the FCA love to say)

 

 

From a personal point of view - I honestly wouldn't bother with a court case - Just do what i've done in the past and get your research in a month before your renewal!!