Auto Renewing Car Insurance Could Be Expensive
Insurance comparison site Tiger.co.uk looks at automatic renewal for car insurance and reveals that whilst it may be convenient, it might not always the cheapest option.
Recent reports from The Guardian and its readers suggest that many insurance companies are automatically renewing motor insurance policies without customer consent. It is reported that many motorists are angered by this, not only because they were unaware of the automated renewal when taking the policy out 12 months prior, but also because some policies are being automatically renewed at a higher price.
Many Guardian readers are reported to be annoyed because they have found cheaper prices elsewhere, mainly on car insurance comparison sites. Some may have even found themselves insuring one vehicle with two policies because they were unaware of the automated renewal and have had to pay out cancellation fees as a result.
Auto renewing motor insurance is not a new phenomenon; according to figures from the Financial Ombudsman Service they can receive approximately 500 complaints annually on the matter. Insurance companies have fought back saying that they always provide ample time before the renewal date and provide their customers adequate warning. They also report that many customers welcome the service as many would rather stay loyal, don’t have time to shop around, and importantly, would rather not risk being uninsured at any time.
Insured drivers interviewed by The Guardian complained that insurance firms do not make it clear enough when they take out the policy that it will renew automatically. They also complained that in some cases the new insurance renewal premium is substantially more than the current premium being paid, implying that auto renewal is more of a money making scheme rather than a benefit to the customer.
Andrew Goulborn, Commercial Director at Tiger.co.uk commented: “We would recommend that shoppers enquire about auto renewal at the point of taking the policy out and always check policy documents thoroughly so that you don’t encounter any surprises. Automated renewal is normally presented as an option and as such, shoppers can choose to opt out. Most insurers will provide two weeks’ notice of renewal in writing, at which point it is always advisable to compare car insurance quotes from different insurance companies to see if you can get a better deal before you make a decision on whether to renew or not. Using an insurance comparison site like Tiger.co.uk can make this process easier. At Tiger.co.uk we have over 150 insurance partners to choose from and our ‘Easy Fill®’ form makes shopping around quick and simple.”