Insurers are good at coming to our rescue – and also at playing us for suckers

Several of you have been in touch about your insurance renewal woes – in response to the stories I’ve written recently about people being ripped off by motor and home insurers that take advantage of your trust to raise premiums sneakily, leaving millions paying more than they need to for cover.

First is a tip from Julian Ayres. He told me: “Some years ago I was told by my insurance company that they were obliged to quote the renewal figure given them by the underwriters of my current policy, but that it was always worth while to ring and see whether they could do better.

“Over many years I have found such calls nearly always paid off – sometimes handsomely.” That is a good tip, but it’s also worth getting a price from a rival first and asking if your current insurer will match it. Often it will.

Meanwhile John Eaton reported that he received his renewal notice from Churchill on the same day he read my last column. Discovering that the premium had climbed £50, he decided to switch. Looking closely at the policy, however, he discovered two more rip-offs that we’ve covered here before but are worth looking at again.

John explained: “If I cancel my policy, an admin fee of £52.56 will be charged. If I amend the policy, another £26.28 is taken. What a rip-off! Is this legal? I take it this is how insurers are overcoming the switchers – by clobbering us with high fees.”

I agree the fees are a rip-off. The insurers say cancelling or changing a policy means they have to do some work, but I reckon they should charge a nominal amount – a fiver or so – rather than the outrageous figures that some try and get away with.

In the past I have reported on people who have moved home or got married and needed to change their address or surname. They have been rightly outraged when stung with an unexpected and expensive fee. Reasonable insurers should waive the fee if the change is beyond the consumer’s control, I believe.

Finally, for this week at least, I heard from Catherine Moore, who told of a nightmare experience dealing with her insurance broker following a dispute with a third party. “I was ignored until I threatened to contact the ombudsman,” she said. “The general policy of the insurance industry seems to be to wait and see if customers will complain – and to penalise them until they do. In my case, my no-claims bonus was unfairly prejudiced and I got redress only after I contacted the ombudsman.”

Catherine reckons that such behaviour is another devious way of raising premiums. I have some sympathy with her view given her troubling experiences, but I don’t believe that insurers are deliberately unhelpful.

Look how quickly they reacted to the flooding disaster faced by many in the past couple of weeks. Insurers arranged to send staff and help to those affected within hours. Frankly, if they consistently failed to respond positively when people claimed, they would soon be out of business. However, we still need to get them to play fair with us all along the line.