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In message , Tim wrote

But you can - you just need to change insurance companies every year. The problem with a lot of insurance companies is that they don't just remove the original discounts but add the equivalent again to the second or third year premiums if you are mug enough to stay with them.

The anti-virus service I have for my computer has an option to automatically renew the subscription every year using a credit card. I know from past experience that if I take that option they will always charge me the maximum price they sell the service for. So instead, I just let the subscription lapse for a couple of days and then go back to their web site to sign up again with whatever is the best deal they are offering at the time.

It just seems so unnecessary to have to go to all that trouble, and they're also risking losing my business because it provides an opportunity to look at what is available from their competitors before deciding whether to renew. They already have me as a satisfied customer, so why not reward that loyalty by guaranteeing the best available price if I agree to allow them to automatically renew my service.

Chris

In message , Alan writes

Unfortunately you only find out how good your insurance company is when you have a claim and the other party brings a court action against you. That happened to me after a simple 50/50 scrape in a car park.

I fail to see why that should "really piss you off". I'm sure your constitution is robust enough not to let such trivial matters rile you.

That apart, it doesn't strike me as in the least unreasonable for people to expect to be given a loyalty discount by their existing insurer or service provider or whatever, to act as a disincentive to be tempted away by competitors' introductory discounts.

In message , Gordon H wrote

And does a premium that cost more going to give you a better service? Does loyalty give you a better service?

Many of the different insurance companies you see on TV or the web are just branding for the same company. Much of the offerings from "well respected" players are just a brokerage service where the actual insurance is provided by the main insurance companies.

I've often changed from one brand to another (with the same parent company) and obtained a large saving on the renewal quote for a second or third year.

With regards judging a company by it's after sales or claims service, is the company you insured with last year actually the same company you may renew your policy with today?

Branding such as Tesco insurance probably means that they change insurance companies regularly based on how much commission they are receiving. In these tough financial times how may insurance companies have been sold by their parent banks etc. Keeping a policy with the same branding doesn't mean that you are going to get the same after-sales service today that you got a month ago.

In message , Alan writes

Probably, yes, if it's a well established company, I am well satisfied with the way my claims were handled.

I spent some time looking round for a cheaper policy for a lady friend recently, and found some which were about 40% cheaper than what she paid, but the excess was more than the premium. Fine if you never have a claim. The final policy conditions are *rarely* the same as shown on the online comparison sites, IME.

There were quite a number of companies who would not insure a 76 y/o lady, and some who would not insure her 10 y/o car.

Choosing the cheapest insurer is ok if that's what is most important to you, I'm not out to change anyone's mind...

It's largely the fact that "new" customers get discounts (which work because of the apathy thing) which supports the assertion that winning new clients costs heaps more than retaining existing ones.

How do you suppose insurance companies et al distinguish between the impact of "marketing spend" on retention rates as opposed to "winning new business" rates?

In message , Martin wrote

The majority of people must be paying well over the odds for insurance or else all the insurance companies that advertise on TV would not be able to claim that they are saving people up to £200 when you buy insurance with them.

If their quotes were £200 less than what I'm currently paying for car or house insurance they would have to pay me :)

It was the AA that was the worst offender IME. They increased my fee one year by about 50%, at the same time offering the equivalent discount for new customers. I phoned them up and wrote to them asking them to offer me a discount but they refused so they lost a customer of over 10 years. Very stupid I call it.

Unfortunately you never know whether you are going to be involved in a collision in any year. Is it worth spending 100's of £££ extra just for "peace of mind"? Until you have a claim you do not know how this would be handled by any company. IME all insurance companies will help you as little as they can.

My m/c insurer did something sneaky last year. On the renewal letter I saw they had doubled my excess (hidden in small print) but, when I phoned them, they reduced it back to the original amount without any increase in premium (after giving me the usual sob-story about the poor insurance company). This makes me think they were trying to trick me into accepting a larger excess.

I'm sure they can count the number of new customers and compare this with the number of existing customers lost. I guess all they care about is if the former number is larger than the latter.

It must be vastly cheaper to keep existing customers since the marketing costs are almost zero. A customer with a good history of paying is also far less risk then a new customer who may fail to pay or abuse the service.

Likewise. They refused to admit that it was just a scam to con people into paying more than they need. If they are happy with the lower amount from new customers, then I can see no doubt whatever that their intentions are to deliberately overcharge existing members, hoping to get away with it. I also moved elsewhere - but I expect the same from the RAC next year. When this is repeated for my house insurance, my motor insurance, my ISP, and various banking and investment transactions like ISAs, it becomes a major hassle keeping pace with it.

Much as I tire of excessive legislation in all fields, the UK is long overdue for a Law compelling anyone selling anything to charge the same fixed price to all customers - all other things being equal, of course. Whether it is the AA, the Banks, Credit card firms, or the local corner shop, there is an urgent need to stop these rip-offs.

On 01/11/10 09:24, Mark wrote: ....

I'm not sure that's fair. Going back a few years, I was rammed in the side by a car coming out of a side road. No issue of liability, but it was a Q-reg plate, and the insco couldn't trace the driver. Even so, they both covered the repair cost and closed the claim in my favour, with no loss of NCB. That was Churchill, btw.

Why? It's a numbers game, and they know the majority are lazy and apathetic. If they put up their prices 50% and lose a third of their customers then that's a result, they have the same revenue but less customers to service.

They might not make a profit on the lower amount, but simply from the % they know will stay to pay the higher renewals. A bit like 0% balance transfer deals on credit cards (which are starting to dry up as people wise up).

The trouble is that companies who offer good value to long term customers lose business to those who offer initial discounts followed by rip-off increases. People look at what it'll cost *now*, not next year.

Nationwide tried it in the mortgage market a few years ago - when everyone was offering "2% discount for the first few years" type deal with an SVR of about 2% above the base rate, Nationwide reduced their base rate to something like 0.75% above the base rate and no discounts. Guess what? They lost business to Halifax etc who were offering big discounts on a higher SVR.

But all other things are never equal, so it'd be hard to frame a law. Anyway - it's consumer behaviour which drives this - people don't look for long term value, they look at the cost now.

But I don't think it was a "loss-leader" since they hiked their prices up and offerred a "discount" equal to the price hike for new customers only.

Their SVR is now 2% above the base rate (for older mortgages) and much higher for newer morgages.

Some of us do.

It's perfectly fair. My experience is that insurance companies will help you as little as possible. They will try to wriggle out of claims or reduce the payout as much as possible. I'm sure some people have good experiences from time to time but I have always been inconvenienced and usually lose out financially.

But is Churchill now owned be the same company and is the service just the same? You would be unlikely to find out until you have another accident and by then you may find that they treat you differently but you have been paying an extra loyalty premium for years.