Paying too much for insurance?
Are you paying too much for insurance?
An investigation by the Daily Mail has found that firms insuring the over-50s are routinely charging older people hundreds of pounds more than the cheapest deals available. Furthermore it found that specialist firms Saga and Age UK are often among the most expensive for older homeowners and drivers.
In some cases, new customers are being charged significantly more than the cost of comparable cover elsewhere and loyal customers who remain with Saga and Age UK then face huge hikes in their premiums.
GoCompare, the insurance comparison website, warn that so-called specialist insurers do not always offer the best value, so never assume that just because you're over a certain age they'll be the right choice for you. They also say that older drivers are typically attractive to insurers as they tend to be lower risk, so that should result in a range of competitive premiums to choose from.
The investigation exposed how the biggest insurers routinely charge long standing customers up to three times more than new customers. Experts say this is because insurers use existing customers' premiums to subsidise the cheap deals used to attract new customers. Older customers are among those most at risk of overpaying as they are less likely to shop around each year.
Firms such as Age UK and Saga claim to specialise in providing older homeowners and motorists with affordable cover and to those struggling to get cover elsewhere. But the latest findings suggest these firms charge customers higher rates from the outset.
Here are some examples from the investigation
· A 94 year old man from Dorset, discovered his premium with Saga had risen by 50%, from £350 to £544, in a year. He was told it was because he was in a flood risk area (even though he was last flooded in 1979). He has moved to John Lewis for £328.
· Retired sales manager, 83, found her car insurance with Age UK rose by £308 in a year, despite making no claims and keeping the same car. When she took out cover with Age UK two years ago, she paid £681 a year. The next year, it rose to £777 and then to £1,085 12 months later. She is now with Direct Line for £780.
· A woman discovered her 87-year-old mother was paying £400 a year for contents and buildings insurance with Age UK. She had been with them for ten years. When the daughter enquired online using her mothers details as a new customer, she got a quote for £198. She then found a better policy with Churchill for £106.
Specialist insurers can offer customers the right solutions for their needs. This can especially be the case if your situation is unusual or you find it difficult to get insurance from usual sources. However, you should always get a couple of alternative quotes at renewal time.
You can read the full article at Over-50s insurance that costs SEVEN times the best rate
What can you do ?
The easiest way to get insurance quotes is to use online comparison websites. The top ones are confused.com, comparethemarket.com, gocompare.com, moneysupermarket.com. If you don’t have access to the internet, see if a family member or friend can help. The local library have computer help sessions too.
Alternatively there are insurance brokers that can be contacted by phone. You can find a local insurance broker from the British Insurance Brokers Association (BIBA) by contacting them on 0370 950 1790 (9-5 Mon—Fri). They will then contact insurance companies for you to find out the best deals. In addition, you can go direct to individual insurance companies yourself. Some, such as Direct Line on 0345 246 8701 are not included in comparison websites so you can only get quotes from them directly
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