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Car insurers charge eye-watering fees, claims Which? | Car insurers charge eye-watering fees, claims Which? |
(2 days later) | |
Some car insurance providers are charging "eye-watering" fees on top of annual premiums, according to the consumer organisation, Which? | |
It found that some insurers charged up to £75 for cancelling a policy - even in the cooling-off period. | |
Others charge £50 to renew a policy or £30 for duplicate documents. | Others charge £50 to renew a policy or £30 for duplicate documents. |
In response, the industry argued that overall premiums had fallen and that the market was highly competitive. | In response, the industry argued that overall premiums had fallen and that the market was highly competitive. |
In its study, Which? looked at fees being charged by 44 UK car insurers. | In its study, Which? looked at fees being charged by 44 UK car insurers. |
'Squeezing money' | 'Squeezing money' |
It found that one provider, IGO4, charged £35 for adjustment fees, such as changing your name, your address or your job. | |
Five other companies did not charge anything. | Five other companies did not charge anything. |
Another provider, 1st Central, charged £50 to renew a policy, while most other companies process renewals for free. | |
Axa Direct and Swiftcover both charged £30 to provide duplicate documents - again a service that is usually free. | Axa Direct and Swiftcover both charged £30 to provide duplicate documents - again a service that is usually free. |
Other companies charged considerably more than their rivals when it came to paying monthly, rather than annually. | Other companies charged considerably more than their rivals when it came to paying monthly, rather than annually. |
"We've found some insurers charging customers eye-watering admin fees that can be hard to avoid," said Richard Lloyd, the executive director of Which? | "We've found some insurers charging customers eye-watering admin fees that can be hard to avoid," said Richard Lloyd, the executive director of Which? |
"We want companies to ensure their fees reflect actual costs, and aren't just a way to squeeze more money from customers." | "We want companies to ensure their fees reflect actual costs, and aren't just a way to squeeze more money from customers." |
Tips for consumers | Tips for consumers |
However, the insurance industry said the market was highly competitive, and that average premiums were lower than they were two years ago. | However, the insurance industry said the market was highly competitive, and that average premiums were lower than they were two years ago. |
The Association of British Insurers (ABI) advised customers to read their policy documents carefully. | The Association of British Insurers (ABI) advised customers to read their policy documents carefully. |
But it agreed with Which? that extra charges should reflect the costs involved. | But it agreed with Which? that extra charges should reflect the costs involved. |
"In accordance with the rules of the Financial Conduct Authority and relevant legislation, the fees insurers charge must be clearly and fully set out, and broadly reflect the costs they incur," said James Dalton, the director of general insurance policy at the ABI. | "In accordance with the rules of the Financial Conduct Authority and relevant legislation, the fees insurers charge must be clearly and fully set out, and broadly reflect the costs they incur," said James Dalton, the director of general insurance policy at the ABI. |
Which? offered three tips to consumers looking to minimise extra charges: | Which? offered three tips to consumers looking to minimise extra charges: |
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