Home owners are being encouraged to contact their insurance providers and enquire about the prices they are paying. Over time, gradual increases through policy renewals has meant that the original prices have significantly increased. The issue is that these renewals appear occur without the home owner’s knowledge.
In some cases, home insurance premiums have increased every year between 2009 and 2016 and have alarmingly exceeded £100 per month. It is these extreme changes that have caused concern for propertyowners and motivated them to enquire further. Upon further research, home owners have found that current quotes are being offered at a much cheaper rate than what long standing customers are paying. For example, loyal Halifax customers have found that they are paying 3.5 times more for the same cover that is being offered for new customers.
Insurance providers like Halifax have responded to such issues, stating that they ‘communicate the renewal price to customers clearly every year, prior to renewal’. Essentially, they view it as the responsibility of the customer to consider the price of their policies. Indeed, home owners could be more proactive as a solution. However, customers are understandably under the impression that the providers they choose are fair and reputable. There is an element of trust on the consumers part that they will be given a fair price.
It isn’t wrong for property owners to assume that their insurance provider won’t increase the price of their policies by such an exorbitant rate. Furthermore, customers who are consistent and timely with their payments and haven’t made any claims shouldn’t have their loyalty ill-treated. It is questionable when companies have an automatic renewal system, especially when there are other options available for home owners.
There are rules in place to try and protect people when it comes to rising home insurance policies. In April 2017, the Financial Conduct Authority ordered firms to disclose premiums from the previous year with each new renewal. However, it remains useful for companies to always remind householders what they paid initially compared to the most recent rate so that they know if they are paying more, therefore an informed decision can be made. It is paramount that insurance firms are completely transparent with their customers, whilst the public needs to be more vigilant with the policies they are paying for.
