I have no idea how much money is spent on home insurance every year but enough to build a mountain. Year after year insurance companies around the world remind us that we have to renew our insurance arrangements.
Here at my house, our home insurance is with a well-known British company called Direct Line and to make the premiums a little cheaper our buildings insurance is married with our home contents insurance. We have been with Direct Line for ten years and have not claimed for anything.
This year I received our renewal letter and it said that the premium we paid last year - £257.60 had now risen to £303.52. This represented a rise of £46.
Anyway, I phoned Direct Line today and said that if the premium was not reduced we would be arranging our insurance with a different company. The fellow at the other end of the line left me on hold for two or three minutes and then returned to the phone with a much better deal. In fact that phone call saved me £28. But why didn't I get that deal in the first place? I suspect that some people never challenge increased premium notices and this helps to boost insurance company profits.
I wonder - does this kind of insurance chicanery happen in other countries such as America, Canada, Ireland, Australia and Germany? It seems to happen to me every year and in relation to car insurance too. It is like a game. They pump up the premium, I challenge it and then they reduce it. It is as if they are actively trying to engineer widespread fraud. They don't give a damn about loyalty. Customers are treated like piggy banks that they shake. The more that they can get out of us the better.
I'm in rural Canada. We have this magic circle thing. My neighbour lives within 13km. of the closest fire hall. I live 14.2. He pays about a third of what I do. There won't be any deals for us going forward. We had a pretty serious chimney fire in January that is going to cost the insurance company mega bucks to repair. We're just praying there won't be a big jump in cost next year.
ReplyDeleteThank heavens the chimney fire did not burn down your entire house Karen! Just because somebody makes a claim should not mean that their insurance premiums rocket upwards.
DeleteThe same scam is practiced here. We went through it in Feb. We got a reduction this year but sometimes you end up dealing with a tough guy who won't give you a break.
ReplyDeleteWhy can't they just be fair with loyal customers? Is that too much to ask for?
DeleteAs I learned from Carlos, it never hurts to ask; because he questioned our ATT service, and complained that it was too high, we not only got a reduction in the bill, but were told we qualified to for free iPhones because we'd been with them for so long.
ReplyDeleteGood on you for questioning the increase~!
Many people just pay revised bills without question.
DeleteIt's the same here in Australia.
ReplyDeleteThey behave like crooks. A kind of organised crime.
Delete"does this kind of insurance chicanery happen in other countries" Yes it does. Homes, contents, cars, health, all are subject to the whims of whoever decides the premiums. We are constantly told to "shop around" for better deals. and often too late, we find out that what we are claiming for isn't covered. Flood, fire, earthquake? Sorry sir, your insurance doesn't cover those happenings.
ReplyDeleteWe live in parallel universes Elsie. Insurance practices have spread like a pandemic.
DeleteIt's not just insurances. Telephone and internet providers do exactly the same, as do many providers of other services such as electricity, gas and water. When you question their price increase and threaten to go elsewhere, you often get a better deal.
ReplyDeleteIt is of course perfectly legitimate for a company to want to run a profitable business, but it should not be done in such a sneaky way.
There should be clearer laws that require insurance companies to play fair.
DeleteI don't like Life Insurance, I mean what is the point of insurance when you are dead? But seriously I did get a good payout when my camper van was nicked off the drive.
ReplyDeleteWe need it but we hate it.
DeleteInsurance is like choosing where you grocery shop YP. You decide if it's Mark's and Spencer's or Lidl? You have got to shop round. Insurance is a lot cheaper in England than in Ireland, especially car insurance. I suppose it's the population size and over 33 million car drivers?
ReplyDeleteIt's very hard to know if a cheaper price from a different company will give you commensurate insurance.
DeleteSome years ago my aged father in law was discovered to be paying over £500 for his house insurance. Obviously been with the same company for years ! We looked into it and changed it to a company charging less than £300.
ReplyDeleteIn an ideal world, that insurance company would have been brought to court over that attempted extortion.
DeleteYes, it's the same here. Last year I was given options on my house and contents insurance and went for the more expensive - about 60 euros difference. The more expensive option offered a much wider cover. I automatically get a reduction on my house insurance because I have those metal grilles, called rejas, and metal roller blinds (called persianas) at all the windows and what they call "Panzer glass" in the front door. My car insurance (with Red Line - or Linea Directa as it's known here) went sky high two or three years ago to over 500 euros. I'd never had a claim and after I quieried the increase it was reduced by half!
ReplyDeleteWe haven't got rejas or persianas here - two new words I never thought I would acquire today. Good on you for querying your car insurance like that.
DeleteSheffield's own Martin Lewis.
ReplyDeleteFartin' Lewis.
DeleteRule Number One: Don't just renew with the same company. Shop around using a broker - at no cost to you. They'll find you the best deal on the market. Loyalty [when it comes to financial dealings] doesn't pay. I love car insurance. No claims bonus - the holy grail. Some ten/twelve years ago, when the Apple of my Eye got his first car, the premium was eyewatering. And I mean eyewatering. Now? It's a fraction. My own? Miniscule.
ReplyDeleteAnyway, there is an art to risk assessment/underwriting. Try being a scaffolding or roofing company taking out insurance including third party liability. You won't know what's hit you. Still, when your employees fall off the ladder their families will still be able to eat. As will the insurer.
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It's not just insurance. Mobile phone companies and internet providers do this kind of thing too. It's a good idea to challenge your plan every few years.
ReplyDeleteGiven their sneaky tactics, I think these folk must also be responsible for spamming.
DeleteHome insurance, car insurance is much the same here. The insurance company can usually change the risk classification and change the rates, so for example, confirming you do have locks on the door, oh we can give a discount for that, or oh, you don't use the car to commute to work, we can give a discount for that.
ReplyDeleteTheir slipperiness is reptilian.
DeleteProperty insurance in Florida has gone up astronomically in the past year or so. The companies are hand-in-glove with the lawmakers. Many are growing angry that while the state government is busy making laws to prevent children from reading books that might actually educate or enlighten them and forcing transgender people to use the public bathrooms of their assigned gender at birth, insurance rates are going through the roof, putting a heavy burden on home-owners.
ReplyDeleteAnd as Steve said- it's not just the insurance companies that charge whatever they can get away with unless challenged.
Poorer people must be driven to doing without insurance. I wonder if homeowners have insurance in Haiti and Gaza?
DeleteAt least where I live, I have found insurance companies to be largely inflexible. The only way to lower rates is to tweak your coverage limits. But there are other companies that operate much like you describe, cable television being a great example. I call every so often and generally they cut my bill by 50% each time. It goes up just as fast too.
ReplyDeleteWe have to keep on the ball if we are going to defeat the enemy.
DeleteInsurance is tricky because you don't get a payout unless something awful happens and you don't want anything awful to happen but then it feels as if you are just paying for nothing...
ReplyDeleteMany homeowners are paying for nothing. And if you make a claim there's no guarantee that your insurer will honour their promise.
DeleteI agree. If they can reduce the price when you threaten to leave them, then why couldn't they in the first place? I have just had the same chicanery with my car insurance. They were increasing my premium by an extra £66 despite the same car and no claims for more than 9 years. I didn't even bother arguing with them. I did a quick compare and found one with a different company for £30 cheaper than last year. When I rang my existing company to terminate the contract they agreed they could not match that.
ReplyDeleteThey have lost a loyal customer - one they were trying to rip off - so sod them!
DeleteOur home and contents insurance premium increased by 50% this year. Rather a shock.
ReplyDeleteServes you right for applying gold leaf to your roof!
DeleteProbably the same here, but since I live in a rented flat I only have the "home contents" kind of insurance. I got a minor reduction on the insurance cost when the landlord put in "security doors" a few years ago. (I knew to ask for that reduction as every now and then I've had to fill in forms asking about certain details that affect the insurance.)
ReplyDeleteI agree with others above that there are lots of other costs that might also be negotiable - but it's also takes a lot of time and effort to complain and compare and ask around etc. Also not always easy to compare as the details of what one gets for the money might also vary quite a bit...
It is all a minefield and they know that so they take advantage of us all.
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