Caroline Flint

Standing up for Don Valley.

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MP demands end to £2.3million rip-off

Caroline_Flint_MP_-_moneysupermarket.jpgCaroline Flint MP has taking action in parliament to help save Don Valley drivers £2,273,775 on their car insurance.

Research by price comparison website MoneySuperMarket found auto-renewal of car insurance policies is costing UK drivers £1.3 billion, and that practices used by many insurers make it harder for consumers to get a better deal.  Caroline Flint is calling on the regulator to require insurers to clearly ask consumers whether they want to opt-in to auto-renewal when they first buy their policy.

Said Caroline: “It’s unacceptable that drivers in Don Valley are losing £2.3 million because of unfair practices by the insurance industry.  This is money that many people can’t afford to lose.  The regulator must take decisive action to put drivers back in control of their insurance.  People shouldn’t have payments taken automatically from their accounts unless they have given their explicit consent. Insurers need to do more to ensure it doesn’t happen”.

“Six out of ten consumers admit that having their car insurance renewed automatically deters them from shopping around for a better deal.  It is clear that by not checking for other quotes, people end up paying more.”

MoneySuperMarket’s report shines a light on the poor practices of insurers, revealing that people often have no idea that they’re agreeing to auto-renewal when they first buy their policy, and would have no way of opting out even if they did. When renewal time arrives, the letter or email they get from their insurer can be confusing and misleading, and even conceal significant changes to their policy.

Said Caroline: “We also need to tackle the insurers who make cancelling an auto-renewed policy difficult.  It is wrong for providers to be charging cancellation fees or driving customers to expensive premium rate telephone numbers.  Most insurers do not provide an online cancellation process, despite allowing customers to buy their policies online in the first place.  That cannot be right in this age of online transactions.”

The research showed that 62 per cent of consumers say auto-renewals deter them from shopping around for a more affordable policy. And almost six million drivers (23 per cent) automatically renewed their car insurance with their existing provider when their policy was last up for renewal, without checking a single other quote.

Dan Plant, Editor-in-Chief at MoneySuperMarket, said:  “As our report lays bare, auto-renewal is far from fair, it reduces proper competition and ultimately costs consumers big money. Our Eight Point Plan shows how insurers can make the auto-renewal process fairer and clearer, helping customers to save money, and we urge the FCA to take action to fix the market. Simple changes such as writing renewal notices in plain English, asking consumers to explicitly opt-in to auto-renewal when they buy their policy, and providing a click-through cancellation button on renewal emails will help drivers to make sure they are not paying more than they need to.”

 

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