I have just been reading the insurance policy for my now dead Honda 125 with Bennetts and I spotted written in the smallest print on the page a note about auto-renewal, something I have not come across before with bike insurance. I don't know if other companies do this, they probably do but it is something to look out for especially as I like to shop around each year before renewing.
There was an option on their contact page for stopping it which I have now done.

My renewal quote from Carol Nash came though last week with an auto renewal on it as well.
Went online as a new customer and it £60 cheaper with protected no claims bonus added as well!

OP, what's the problem with the auto-renewal clause on your policy? Normally I like my insurance (car, house, health, whatever) to automatically renew because otherwise I've got to fill out a fresh application in advance of it running out every 6 months or year. Much simpler to have it renewed without any attention by me; the company sends me a bill and I pay it.

It's difficult to see any downside. I don't put insurance on any form of automatic payment (i.e. by direct debit to my bank account), so if I don't want it renewed I can easily not pay the premium.

The only exceptions are travel-related policies--medivac insurance, or the bike insurance I purchase when entering some countries. Those never auto-renew.

I've never tried to re-apply as a new customer per #2. I'd expect that claiming to be a new customer would involve lying in print, which might cause me difficulties down the line. However, that's just an assumption.

Mark

Bike sure do it too - sneaky gits. They have a small print clause that allows them to take the money out of your account via auto renew up to five days before its due....meaning they've done it before you remember to renew or shop around. They gave mine back but only after a fight (I no longer had the bike and hadnt cancelled it because the bike was trashed and I didnt want to pay the cancellation fee).

Auto renew should be banned.

They put the prices up year on year, and hope you won`t notice.

Renewing as a new customer is no issue. Once your policy has expired you are a new customer.

Even if you ask them on the phone, they will requote with you as a new customer, thats what they do when you call and say you are unhappy with the renewal price anyway

Insewerance, robbery.

Interesting. I like auto-renew. Sometimes the price goes up, sometimes down. We don't get introductory discounts for new members here. I never have my policy hooked into my bank account, so I pay by check once or twice a year.

Maybe different in the States, or maybe what works for me doesn't work for you. Certainly it'd be different for #4 if he never authorized auto-payment in the first place.

Mark

It must be different in the States in that case. Here an auto renew (In my and my friends experience) is almost always higher so you end up phoning them and 9 times out of 10 they drop the price.

It's an annual painful ritual for car insurance, bike insurance, house insurance, vehicle breakdown service etc.

Here in France, and I think in a number of other European countries, auto renewal is compulsory on any vehicle policy, and has been for many years. This is to ensure that you are at least covered third party ( or civil responsibility) in case of an accident. I am sure the U.K. are following this as part of the harmonisation programme.

That is the only advantage in case you forget. The disadvantages are that renewal premiums go up every year, irrespective of how well behaved you have been, and sometimes by large amounts, because first years premiums are always at reduced rate. ( My own bike policy has doubled in 3 years, so I 'm going elsewhere). In France, insurers must send you an advice of renewal premium ( avis d'echeance) 15 days before your policy reaches it's anniversary, and you are allowed to cancel the policy by recommended letter at that time, and up to 20 days after the anniversary date).

It's a hassle changing because of the paperwork involved here, and a lot don't bother.

Irrespective of where you live and your insurer, it's worth hunting around, and thank goodness for the good ol t'internet.

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I had wondered whether that was the case here as auto renewal seems to have become close to universal in recent years. I'm now going to have to start another wall chart keeping track of what policy is up for renewal when (already doing it to keep track of tax disc / sorn declaration expiry dates) as the insurance companies obviously see a silver lining in what to me is just a grey cloud - auto renewal on one of our cars put the premium up 2.5x a couple of years ago when we were on holiday and assumed the policy would just lapse. Strangely, the cancellation fee came to just about what they'd taken from our account when we rang them a couple of weeks later.

They're not all thieving amoral sharks though - auto renewal on one of the other cars last month was lower than I could find on the price comparison sites so we just let it run.

Exactly right – motor (and household) insurance policies are annual contracts.

The insurer only has the legal right to invite renewal towards the end of the contract’s 12-month term. Sometimes they don’t make the offer, of course, especially if you’ve had a bad claims experience over the course of the previous year. Actually, thinking about it, I think a motor insurer is obliged to offer terms at renewal, irrespective of your claims record, because it is a legal requirement to insure a motor vehicle whilst on the road in the UK. Of course, the insurer can hike the premium to make it very unattractive to re-new if they don’t fancy you as a risk on their books.

An insurer has the perfect defence to auto-renew, doesn’t it? - citing that because motor insurance is compulsory, they wouldn’t want to see you inadvertently breaking the law by overlooking the policy’s renewal (then pointing the finger at them for allowing the policy to lapse, resulting in you ending-up as a lawbreaker.) But despite this semi-rational excuse .. they’re still sneaky b@stards IMHO with all this auto renewal malarkey!

[Btw, for my sins, I used to work in the insurance racket! ..]

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The renewal letter / email should state that the policy will auto-renew a few days before the actual expiry date. This is to ensure they get your money from the bank on the date the policy expires. However, probably like many others, the reminder usually arrives a few weeks before I get around to searching the web for a better deal. Fortunately, I've not yet been caught out & now always tell them to cancel the auto-renewal, even if I end up renewing with them!

I work for an insurance company (non vehicle related) & the FSA (now FCA) have insisted that we stop auto-renewing policies. I'm hoping that this regulation will cascade down across all insurance policies as it's a total scam to slowly increase payments. What happened to customer loyalty where you got a discount instead?

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Striving to live the ordinary life in a non ordinary way

So it's not some Euro reg brought in to compliment the continuous insurance requirement? :confused1:

They will fight it out. FCA is making a certain credit protection company buy me my next set of tyres on the good old fashioned common law principle of that if you give advice you take responsibility. The European practice of making you have what they say is right only works where the slimebag failed bookies don't squirm when it comes to paying. ( can you imagine if Ladbrokes claimed the favourite falling at the last was an act of god and therefore a reason not to pay out on the 100/1 that crossed the line first!)

The current compromise seems to be allowing them to write and phone and threaten you with going to jail if you don't, cough up.

Personally I hit the web the day their joke quote hits the door mat and ring them back with the results. I've had Hastings direct half a quote on one hand and devitts tell me to just cancel and go the second I mentioned a special offer bike sure ran. It seems to be how they want it.

Andy

Wont ever have a problem with nutters from Bennetts again. Having dealt with them in the past when trying to cancel a policy within the cooling off period and they wanted to charge me 35 quid for flicking a switch, I refuse to deal with them. Here's the text of the letter if you ever get into the same situation. I got the entire premium refunded.


My address1
My address2
My address3

Bennetts Insurance
Pegasus House
Bakewell Road
Orton Southgate
Peterborough
PE2 6YS
10th March 2009
Ref (policy number xxxxx)

Dear Bennetts
I herewith inform you that I have submitted a complaint to the Financial Ombudsman Service. Below is a timeline of my dealings with you (known here as “Bennetts”).

1st February 2009 CB takes out motorcycle insurance online and pays by credit card £229.49 (policy number xxxxxx)

10th February 2009 I receive certificates of motor insurance, policy document, but NO key facts document from Bennetts

11th February 2009 After reading the policy document and looking at the policy excess amounts, I decide (clearly within my 14 day statutory cooling off period) that this is not the right policy for me. I post back, by Special Delivery, a letter to this effect, including the certificates of motor insurance. I have made no claim on the policy.

16th February 2009 I receive a letter dated 14th February from Bennetts saying the insurance is cancelled per 12th February. There is no mention of any fees to be paid.

5th March 2009 I receive my credit card bill. On it there is a debit of £229.49 to Bennetts and a credit of £194.46 from Bennetts. This a discrepancy of £35.03

6th March 2009 at 5.40pm I call Bennetts to complain and speak to a customer service lady. She informs me that the £35.03 is made up of £5.03 pro rata usage and a £30 admin fee. She keeps on referring to a Key Facts document, I haven’t even heard of. She doesn’t have a copy herself either and is unable to tell me where on the Bennetts website this document can be found. (I am online as I call her). If this Key Facts document exists or not, is immaterial. Legally, charges must be “fair and reasonable”. I believe them to be unfair, and I know that by any stretch of the imagination, they are wholly unreasonable.

I know a lot about IT systems. For an admin clerk to press a button on a computer screen to cancel a policy, print a letter and put it in an envelope does not cost any organisation £30 in wages/time, unless of course, this clerk is being paid £30 per minute! If they are, can I have a job please?

As you have not dealt with my complaint to my satisfaction, I have been forced to submit a complaint to the Financial Ombudsman Service. Furthermore, I will forward a copy of this correspondence to the entire printed motorcycle press and post it on every online forum I can. Customers need to be treated with fairness, not ripped off at the first opportunity.


Yours sincerely,



CB

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CB

The Regulator permits a ‘reasonable’ fee to cover admin charges etc, even during the Cooling-Off Period. £30 is within the definition of ‘reasonable’ nowadays. Hell, Swinton Insurance (a misnomer for ‘Swindle Insurance’ btw) were charging a whopping £50 to cover a policy cancellation at least five years ago, which even back then was considered a ‘reasonable’ amount by the glorious Regulator.

I’m not sure about this, but you might have received quicker justice if you asked for a full refund under The Distance Selling Regulations (The Consumer Protection (Distance Selling) Regulations 2000), which provides additional rights, especially if you bought online and cancelled/returned within 7 days of purchase.

With your circumstances, if Bennetts hadn’t of co-operated, then I would have threatened to escalate the complaint to court action, or at least reporting the incident to your local Trading Standards Dept. Obviously you need to get your facts straight first though, which you clearly did.

Summary: Gone are the days when insurance brokers worked exclusively for sales and renewal commission. Typically, 10%-15% x premium for motor insurance; 15%-20% for non-motor insurance (household, personal accident, business cover etc.)

Seems that direct insurers – ‘Direct Line’ was one of the innovators in this field – could cut out the middle man (the broker) and severely undercut on price because no sales commission became payable. Brokers responded by specialising in complex risk management, offering a higher level of service to place difficult risks. Everyday standard personal lines insurance was side-lined to an extent as a result, unless the broker could charge admin fees on top of receiving commission to make deals profitable.

Insurance is a dastardly competitive business. My advice is 'do your homework', shop around hard at least every couple of years for all your insurance needs; and always stand up to the b@stards when they start dishing the sh!t.

Bah! HUMBUG!!
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