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Cost of household insurance

Hi,

I have a mortgage with Northern Rock along with their buildings and contents insurance. When I bought the house I knew their policy may not have been the best on offer but with so many other things going on it was simpler to tick the box agreeing to take their insurance.

I recently had a quote through for the renewal of the policy and checked out the prices for a similar policy with Direct Line. I chose Direct Line partly by random and partly because I could remember their web address. Their quote came out a lot less than the Nothern Rock policy. Even when I adjusted the policy to match the cover I have with NR the policy is about 30% cheaper.

Now either NR is overpriced or there are some other factors differentiating the policies that I am not aware of. I suppose one factor is how good a service they provide when I need to claim on the policy. Will NR process a claim quicker and with less fuss than DL?

Any thoughts?

Thanks Andy

Reply to
Andy Coleman
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No, all insurers are much of a muchness. What you need to watch out for is whether you got a discount on the mortgage as incentive for agreeing to take their overpriced insurance. That's a common ploy by lenders to recover on the roundabouts what they lose on the swings. If you change insurers, they might charge you a higher rate of interest on your loan, and on top of that, they'll charge you a whopping fee for "checking the other insurance is good enough".

Reply to
Ronald Raygun

A great place to find out about such things is to find discussion groups who talk about Northern Rock and what their service is like.

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Reply to
Stephen GoldenGun

Andy, I think all the insurance deals tacked on to mortgages are vastly overpriced, they rely on people doing exactly what you did and 'just ticking the box'; goodness knows how much hassle buying a house and signing up for a mortgage is, most people don't want to start worrying about insurance at the same time. Same thing with travel insurance when you buy a holiday - 85 for a week in Spain? You can get a year's worldwide multi-trip cover for that. They trim their brochure prices and make it back on the extras, just normal retail operation.

I get contents and building insurance through Liverpool Victoria; every year I check and they're very significantly cheaper than the same cover elsewhere. When we got burgled they paid out for everything straight away, camcorder, laptop computer, cash - no hassle, no receipts required for most things. I'd be surprised if you can't save even more with them. And no, I don't work for them, just a satisfied customer.

JD

Reply to
Jon Dunn

There's a very common mantra that say's 'you get what you pay for'. Those who belive this are those who are happy to pay for overpriced items (not just insurance) because then they think they must be getting quality. That's not to say that el cheapo will always do the job of something that costs more, but it may well do. Building society and bank insurances, however, are almost certainly a rip off. People buy from banks because they're big, steady, reliable, blah blah........ They don't realise they're probably paying over the odds for the same product!!

Rob Graham

Reply to
Rob Graham

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