A new poll from Which? has revealed that just 24% of people buying car insurance have shopped around for the price they’ve been offered to renew. More than half, 40% of those adults — over 2,000 adult respondents — never negotiated or tried to negotiate their quoted renewal prices with insurance companies. Rather than hold any discussion, they proceeded with the renewal. Our sense is that this disconnect is perhaps making worse the big price hikes so many consumers are seeing.
The survey showed that 61% of respondents discussed the premiums they were quoted. The majority of these discussions took place on the phone. Specifically, 61% of people who haggled their renewal rates were able to negotiate a lower price. Respondents saved an average of £64 per year, with many respondents saving more than £200 on their original estimated quote.
Many consumers still do not know that they can and should negotiate. The survey demonstrates that a substantial share of respondents benefited from the cuts. The bulk of them just went along and accepted the quoted rates without argument. This phenomenon represents a broader question of consumer knowledge and participation in the insurance space.
These sudden spikes are regularly experienced by customers when they renew, sometimes with no changes in their situation. The Association of British Insurers has noted the considerable variation in pricing. Many of these differences can be explained by things like vehicle crime prevention features, driver behavior, and level of coverage selected.
“These often come down to a deeper dive into individual factors which may have changed from the previous policy,” – The Association of British Insurers.
Insurance companies want you to shop around and compare rates. They could, for example, highlight cheaper prices they’ve found and ask their own insurers to match or beat those quotes. Further, original or very long-time customers will want to play up their longevity during negotiations, which can help.
When insurers are slow to lower rates, try asking for an add-on service. This can add considerable value to your policy, much more than simply ensuring broader coverage can do. These strategies can help consumers navigate the complexities of car insurance renewals and potentially save significant amounts on their premiums.
The survey results indicate that significant increases at renewal are common and confusing customers in the process. As such, proactive communication with insurers appears essential for mitigating costs and ensuring that customers receive fair pricing for their coverage.
“Our members take their commitment to their customers and their regulatory requirements seriously,” – The Association of British Insurers.