Hi all,
Further to my post on Hastings Direct Insurance here, thought people might like an update.
I pay £542 a year for fully comp with them (lots, yes, but I've a knackered NCB). Just moving house, so call them to update the address.
£109.00, which considering there's 4 months left on the policy makes it (12/4=3*109) £327.00 per year extra equivalent.
Fair enough if I was moving to Mosside, Manchester, but I'm moving to a leafy part of County Durham that is rated lower in postcode terms than my current address by five on-line insurers - (AA, Directline, EagleStar, RAC & Morethan). Cancelling the policy will net me £54 quid, so I'm effectively stuffed and have been forced to cough up the readies.
I have recommended this lot before, but I now take this opportunity to withdraw that recommendation.
Would be interested to hear of anyone else's experiences with them.
Lee.
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The photo gallery is yours!
why not mail some images to share?
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They can be cheap.
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Lee,
Mark(Brazil) may have an angle on this but I've known some stupid increases like this when there is a mid-term change.
Take a customer with an expensive to run/repair people carrier worth about £4K. They are nearly 40 but have suffered a total loss claim in the recent past so paid £1000 for comp last time on the people carrier.
Six months into the policy they change for a mundane TD family hatch worth about £3k (and in my book three groups lower). Company says they would be pleased to swap the vehicles for a payment of £300 extra for the remaining time. That equates to £600/yr extra for a lower rated car...just what are they playing at?
A few phone calls and the customer went to a completely new insurer with the same cover for £500 all in for a whole year.
I owe you a mail - sorry. Good work with the under used image gallery!
David
(Who hasn't yet been bothered to get his own pic uploaded)
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They would not quote for my old Pug 205XLD 'cos it had an non standard steering wheel (liberated from a scrapped GTi). I was honest enough to answer yes to the question about modification from standard spec.
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>>Mark(Brazil) may have an angle on this but I've known some stupid increases like this when there is a mid-term change.
And it is sometimes [usually] not the insurance company....
When a change is made to your policy, it is called an endoresment to your policy schedule.
This may, or may not, reflect in a change in premium.
Now what happens in reality is this.....(we assume you made this change today)
Insurer will rate your new risk on today's rates.
Insurer will rate your previous risk on today's rates.
Difference in calculated.
Additional premium is not this difference pro-rated. It is proportioned using the company's short-term rates, which are published. I really can't remember them off-hand - but they're scary.
The short term rates are used for cancellation, risk change and for extension. As I said, I do not remember them, but it is something like 4 months = 100% of premium. i.e. 4 months left of the year for an increase premium, pay it all. 4 months of the year left for a reduced premium, give back about 10%.
Then it is sent to a broker. Never good for your pocket.
The Broker will add a charge to additional premiums and reduce your return premiums. This is outrageous since the broker's effort involved sending a memo to your insurer and passing the endorsement on to you. (two stamps and about 2 minutes).
I cannot tell you how this works now, although I suspect it hasn't changed much, but we used to assess what we could get away with.
Certainly most return premiums were held on file for your future credit. "Your Future Credit" translates as some money we'll give you if you ever get around to asking about it persistently.
Additional premiums could be increased considerably. The Provident, for example, was always very generous with Change of Car with less than two months to run. We, however, started the fee at 25 quid.
Always insist on receiving the insurer's endorsement. It is as much yours as the original policy document it amends. Insist - and if you notice a discrepancy in charge or return higher than the broker's displayed admin fee - challenge.
Finally, reducing your car to a alower group may take you out of that insurer's target risk area, and mean your premium is less competitive, even though the risk is better.
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And by the way, I forgot to explain - they use today's rates to calculate your new and previous risk circumstances -
Or at least they should - frequently they don't and large additional premiums can result.
And even if they do, insurance premium increases are not uniform across the entire spectrum of risks. Therefore you can get burned by an insurer rebalancing his portfolio.
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Yep I thought it would be something like that.
David
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Thanks Mark,
it helps to understand what's going on a little better.
I'll follow up what you mention about the insurer's endorsement - if for nothing else than to try and get a least a little bit of action for my money.
Cheers again,
Lee.
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I don't believe what Mark says about short-term rates - it is not general practice for insurers to do this. And they don't all calculate the new premium based on today's rate for the new car - the fair ones calculate what it would have been at inception, pro-rate it, and charge the difference.
I have experienced this many times!
I however agree with the criticism of Hastings Direct and have dumped them myself for similar reasons. I reckon that they price VERY competitively to win business but take the p*** on additional charges, renewals, etc.
In fact, because I never learn, I've dumped them twice!
Once for levying short term rates when I had to cancel mid-term due to unexpectedly getting a company car (which they backed down on after a serious complaint) and once for putting the premium up by some completely ludicrous amount (approximately 50%) for me gaining 3 pts for an SP30 - first points on the licence too! All the other insurers I got quotes from on the internet didn't load for these 3 pts at all.
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Hastings Direct do indeed offer competitive rates in many areas, but......
Their customer service is lousy. I dumped them because I had to spend at least 20 minutes on hold if I wanted to speak to anybody, any day of the week, any time of day. In one case I was transferred by a Rep that couldn't answer my question to one of his "colleagues", straight back to the end of the queue.
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>>I don't believe what Mark says about short-term rates - it is not general practice for insurers to do this.
"I don`t believe" would imply I am intentionally lying.
That aside, I assure you that it is [was] a commonly practiced thing, although to be fair, I have been out of the industry for some time.
ALL insurers have and use short-period rates - *ALL*. They use them and apply them differently and at different times, but they all have them.
At least an insurer sends you an policy endoresement showing the additional/return premium. Brokers typically simply forward you one of their own letters, and forget the bit of paper from the insurer.
And as for your "experienced this many times", I probably did it thousands of times - I couldn't even begin to work out how many.
Having said that, every insurer has its own processes, and they all change. Most behaviour is driven by targets...
Questions you might like to ask if you ever have the opportunity.....
1) Excuse me, Mr. Broker Office Manager, do you have a target for additional premiums, retained refunds and admin charges which exceeds what you could possibly achieve if you relied on your published charges.
2) If you retain return premiums for use as later credit;
a) What do you do with the credit if the person ceases to be your customer ?
b) Why don't you retain additional premiums use as a later debit in the same way ?
3) Can you tell me how much revenue you gain each year in interest by delaying payments to and from Insurers and Insureds, even though I accept you remain entirely within industry guidelines ?
4) Can you tell me why typically you do not send out official insurer endorsements, typically not insurer renewal notices, and never renewal notices including proof on NCD preferring to send your own letter, which at least is useless as proof of NCD and doesn't detail to me what the insurer charged me for any change. & this despite the fact that they are routinely sent to you for ALL changes and ALL renewals ?
5) Excuse me Mr Insurance Company Finance Officer, why is it that your company consistently makes an underwriting loss within the motoring segment, but continually shows a profit after investment income is taken into account ?
And so many more..........................
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"5) Excuse me Mr Insurance Company Finance Officer, why is it that your company consistently makes an underwriting loss within the motoring segment, but continually shows a profit after investment income is taken into account ?"
Excuse me Mr Oil Company Financial Controller, why is it that your company consistently makes an loss within the motoring segment, but continually shows a profit when all products produced from the same barrel of crude oil are taken into account?
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