Why are premiums going up? Here's the long answer.

[Dryce]

Hello, my vehicle was legally parked, another vehicle drove into it, why should I be jumping through hoops, making claims on my policy, proving my innocence, recovering excesses or anything else?
100% of the blame lies with the other vehicle.

Insurer just wants most direct lowest hassle/cost (for them) route to close whole case. So if other party disputes anything then they'll as likely try and get you to settle and call it a 50:50 even when it's blatantly a no-fault - that way it all gets cleared.

 

[iscaboy]

Insurer just wants most direct lowest hassle/cost (for them) route to close whole case. So if other party disputes anything then they'll as likely try and get you to settle and call it a 50:50 even when it's blatantly a no-fault - that way it all gets cleared.

PRECISELY.

Give that man a cigar.

 

[Primo]

Insurer just wants most direct lowest hassle/cost (for them) route to close whole case. So if other party disputes anything then they'll as likely try and get you to settle and call it a 50:50 even when it's blatantly a no-fault - that way it all gets cleared.

I don't agree.

 

[Primo]

Hello, my vehicle was legally parked, another vehicle drove into it, why should I be jumping through hoops, making claims on my policy, proving my innocence, recovering excesses or anything else?
100% of the blame lies with the other vehicle.

zurich legal services should have done the following, and ONLY the following;

1. Yes Mr Iscaboy, I can confirm that the hire vehicle is on its way to you as we speak.
2. Yes Mr Iscaboy, I can confirm that in a no fault scenario like this the other party and is insurance company do not get a say in how or where your vehicle is repaired, or in what is an adequate repair, or what the value of it is, or indeed anything else.
3. Yes Mr Iscaboy, we do EVERYTHING, you do NOTHING, that is what you paid us for when you stumped up the extra for legal cover. (don't buy a dog and bark myself)
4. Yes Mr Iscaboy, we work for YOU, not Zurich.

You were badly advised.

 

[iscaboy]

You were badly advised.

Yes, by Zurich who sold me an extra legal aid bit to the policy, and said legal aid cover people then tried to shaft me.

You can stick your fingers in your ears and go nee-ner-nee-ner all day long, it doesn't change the facts.

 

[Primo]

Actually I'm always disappointed when people are badly advised.

 

[Dryce]

I don't agree.

If you have a small bump with no injuries the insurer has little incentive to protect you on a no-fault where the other party's insurers stall or play up.

Their costs/exposure of fighting beyond a 50:50 for you may quickly exceed the cost of fixing your car -especially if you cough up your excess and they bump your premium or reduce your NCD.

It's not a matter of principle for them. Just simple numbers.

So you have a clear cut no-fault. It costs them £1000 to fix your car. It costs them internally a few £hundred to process the claim to that point. The other party disputes it a little and they go for the 50:50. So what? They get say £300 of your excess and another say £100 extra on the premium for the next three years. So that's £400 + their costs.

Compare that with extending the claim with added internal costs, engaging legal services and possibly finding out that their customer was lying to them, or simply backs out when it finally reaches their day in court.

So even though it's a clear cut no-fault under these circumstances it becomes a perfectly sensible business strategy to *actively disuade* their client from pursuing the claim and getting them to settle where the amounts of money involved are below a given threshold.

 

[Primo]

I don't agree, that isn't how it works.

And you're still off topic!

 

[Dryce]

Actually I'm always disappointed when people are badly advised.

There was a situation on the forum a year or two back where a NU client ended up being unable to get the legal services to chase NU.

The legal services add-ons to insurance are a bit of a fuzzy area. Just exactly what are you getting for the money? A third party car warranty plan is probably better defined in terms of obligation.

 

[Dryce]

I don't agree, that isn't how it works.

And you're still off topic!

So how does it work?

And it's not entirely off topic. Thread started with a explanation as to why preimums are going up. This digression has been on to how they save costs at the expense of the customer. Not unrelated.

Getting back to the original post - we see statements from the industry every year about costs going up. Part of this IMO is simply trying to condition a portion of their customer base to the 'inevitable' so they don't question higher premiums.

Even if premiums do go up in general there are still huge discrepancies and inconsistencies.

 

[Primo]

There was a situation on the forum a year or two back where a NU client ended up being unable to get the legal services to chase NU.

The legal services add-ons to insurance are a bit of a fuzzy area. Just exactly what are you getting for the money? A third party car warranty plan is probably better defined in terms of obligation.

The purpose of a legal expenses policy is the recovery of your uninsured losses - policy excess and any other out of pocket expenses. Some legal expenses policies have other benefits too.

Because your excess is an uninsured loss it is not a loss that your insurance company or broker are responsible for. Your insurance company and / or broker are only responsible for your insured losses as per the policy wording. If you would be comfortable attempting recovery of these losses yourself don't buy legal expenses.

Remember that your policy excess is not dependant on an accident being non-fault. Most people claim on their own insurance policy because third party insurers may not be in a position to handle the claim on a direct basis if their client has not reported it yet. Your insurance company will recover their outaly and you (or your legal expenses provider) will recover your excess etc.

I am more than happy to help MBClub members who are in the middle of a claim and hitting their heads against a brick wall, however, trying to unpick an old one is next to impossible.

 

[Primo]

We see statements from the industry every year about costs going up. Part of this IMO is simply trying to condition a portion of their customer base to the 'inevitable' so they don't question higher premiums.

I don't disagree! However, the rationale for the very necessary premium increases that you can expect is no less valid.

Premiums should have been increasing over the last few years, they haven't because no one wanted to lose market share.

This is no longer an option.

I had hoped that reproducing a well written article would be well received, even if the message was not appreciated.

I was wrong; I apologise; I won't repeat my mistake.

 

[iscaboy]

[S-TAG] I was wrong; I apologise; I won't repeat my mistake. [/S-TAG]

A classic case of "not getting it" and "not listening to the customer", and focusing instead on getting the customer to listen to you, and to get your message.

Yes, there are reasons, valid reasons, why insurance premiums are going up.

HOWEVER

The insurance industry is horribly broken, and is still focused on outsourcing all its problems onto the punters cheque books, and not putting its own house in order.

Your flat refusal (as an insider) to accept what more than one punter is trying to tell you about legal cover, just one aspect of motor insurance, is a classic example of this.

 

[iscaboy]

To explain.

I buy a product from you / your company.

I subsequently have a problem with that product.

You / your company then tell me to jump through certain hoops, the inevitable call centre reading from a script.

You try to tell me this is all for my benefit, it clearly is not, it is for your benefit.

The fact is I flatly refuse to partake in such things, Sale of Goods Act etc etc etc all make the duties and responsibilities of both parties quite clear, and none of the statute law says I have to submit myself yo your arcane money saving procedures.

So as / when / if I have a problem I go straight to the vendor, and unless they DEAL WITH IT, I go straight down to the Court and file a writ, and I get the problem sorted to my satisfaction, minimum delay, minimum effort, minimum outlay, maximum satisfaction.

"legal cover" is explicitly sold as being a product that will help me, and yet as my experience and the experience of others goes to show, that is NOT what it does when you invoke it.

YOU PERSONALLY Primo may not operate like that, I don't know, but ENOUGH OF YOUR COLLEAGUES DO that as an industry you have a worse reputation than Arthur Daley.

That is not my problem, I'm a customer, that is your problem, you want my money.

So now you all reap what you sowed, I have precisely ZERO customer loyalty, I trust you less than the other driver in an accident, and so I don't give any of you the benefit of the doubt.

I have an unlimited mileage, £50 excess, fully comp, breakdown and recovery, driver policy, agreed value, for £220 per annum, and I can pay in 10 interest free monthly amounts.

When that policy expires I will shop around again.

That means that the quoted 35% clerical overhead is going to get the chop, and as you can see from my premiums, I am one of the last people who will ever have a problem finding insurance, (no-one has ever made a claim against me) so I am the all profit dream customer.

Check other online insurers, literally dozens of them, which means I DO ALL THE CLERICAL WORK MYSELF, the rest is automatic and done by computers and servers, I could pay over £550 for the EXACT SAME POLICY elsewhere.

The REAL recession is coming down the line, most of the fat is going to get trimmed, yes, there will be more uninsured drivers having accidents, and yes, there will be more people trying to pull a fast one on the medical claims, but that is even more reason for insurance companies to trim the fat and focus or core competency.

I was there on the inside when two very large motor insurance companies merged, and the first UK online car insurance quote and online payment was set up, and it made government look efficient and cost concious.

 

[Primo]

I was there on the inside when two very large motor insurance companies merged, and the first UK online car insurance quote and online payment was set up, and it made government look efficient and cost concious.

What a relief, now we know who to blame!

 

[iscaboy]

What a relief, now we know who to blame!

No you don't, we all sat on our asses while the IT managers of ***** and *** vied with each other for who (and whose department) was going to be left standing and who was going to be given their cards... it was pathetic, like two kids one who owned a ball and one who owned a goalpost both arguing and basically acting like spoiled kids, and the respective boards let them do it...

this went on for six months

we did ZERO work in six months, ZERO, we just turned up and waited.

 

[Dryce]

[S-TAG] I was wrong; I apologise; I won't repeat my mistake. [/S-TAG]

The insurance industry is horribly broken, and is still focused on outsourcing all its problems onto the punters cheque books, and not putting its own house in order.

TBH it isn't broken IMO. It's just a bit shady in terms of how it deals with pricing and customers.

I might complain but compared to how things were in the 80s the industry's customer service and pricing has improved greatly through the 90s.

Now we're seeing a sort of low cost airlines cultural effect where the pricing gets modularised and the customer services get pruned back.

 

[raymont]

Car insurance is a competitive market.

I suspect that a large part of the problem is that car insurance buyers, in the main, seem only interested in price and not value.
They input their details into a comparison website and then buy the cheapest quote they get.
They do not concern themselves with the ‘hard facts’ scope of the cover, driving in Europe, replacement car etc or the softer considerations about service levels, e.g. Indian call centre versus local agent.

I accept that this has been driven, to some extent at least, by the insurance industry but it has been enthusiastically bought into by consumers.

If price, rather than value, is the main decision criteria then it is inevitable that cover will be reduced and service standards lowered to be able to compete on price.

I’m currently insured with NFU, not the cheapest I could find, nor the most expensive.
The level of cover offered matches my requirements, I deal with a local agent not some remote call centre and they have made some attempt at customer loyalty
by offering money off depending on the number of years I’ve been with them. They also seem to come out top / near to top in several independent surveys I’ve seen of car insurance companies.

 

[Primo]

http://www.mbclub.co.uk/forums/members-offers-traders/90460-multi-vehicle-insurance-primo-plc.htmlReplied to wrong thread!