Are you a loser in the car insurance renewal ‘game’?

It’s a minefield, Paul, and Which? is right to remind us to keep shopping around. I chose RIAS because they were so helpful regarding continuing to insure an empty house for over 18 months.

What annoys me more than the need to compare insurance premiums is the importance of keeping an eye on interest rates on savings accounts, where the customer is enticed with an attractive rate and then it goes down to 0.1 or 0.2%. We need a Which? Conversation about this.

A lot of insurance policies are set up on a ‘Continuing Payment Authority’. It is legal but I think it is sneaky. It is usually indicated in the paperwork at the time of first taking out the insurance but it gets lost among all the other details and then a year later you get a notification to say that the next premium will be deducted from your bank account a short time later. If you enter into an insurance policy on-line it appears to be especially difficult to override and cancel the continuing payment authority for future renewals. If you do it on the telephone, and you are not distracted by other issues, you can instruct the company not to set up a CPA, but they are reluctant and you have to insist, and even threaten to go to a different insurer, before they concede – which they are obliged to do. They also must give you adequate time in advance of renewal to cancel the CPA. In future, insurance companies will be required to give at least three weeks’ notice of renewal and to show the previous year’s premium paid for the same cover as well as the new premium.

A CPA works like a direct debit but there is a crucial difference – it will not show up in the list of direct debits held by your bank any of which you can instruct your bank not to accept [you also have to notify the payee but trapping them at the bank first is a good way to stop unwanted payments]. If you do on-line banking, any CPA’s you have against your account from insurance companies, gym memberships, subscriptions, etc will not be listed [in the ‘manage your payments’ section or similar] so you need to make a separate list of any that you have knowingly entered into and try to think of any that you could have entered into unknowingly and then either cancel them or add them to your list. It is obviously a good idea to diarise the renewal dates of insurance policies with a reminder trigger four weeks previously so you can look out for the renewal notification and even start exploring other quotes.