Blog: It Pays To Shop Around
The thud of paper on doormat (well, email into inbox actually) this morning heralded the arrival of an invitation to renew a car insurance policy. It's always an unwelcome intrusion but this year surely it should be less of a shock to the bank account than in previous years. We've all been reading about plummeting car insurance rates and our very own Tiger Watch monitor has confirmed that rates have been dropping steadily since February this year.
So imagine the surprise when, with no change of car or address, no claims, no convictions and no new drivers added to the policy, the rate on offer was actually higher than the premium paid a year ago.
It would appear that many car insurance companies are failing to pass on drops in market rates to existing policyholders, relying on customer intertia to drive policy renewals. If a policyholder is unaware that overall car insurance rates are falling, then there's a good chance that they will accept a rate close to that paid a year ago. Reported declines in comparison site traffic and new business calls to insurance providers appear to back up this theory.
The moral of this story? In a market where car insurance rates are dropping it is still important to shop around at renewal time in order to get the best rates and to properly benchmark the renewal offer being made by your current insurer.