Our latest research has unearthed the eye-watering fees that some car insurers are charging. Some of which don’t reflect the actual cost to the company.
As part of our campaign to Stop Sneaky Fees and Charges, we looked at the different types of admin fees charged by car insurers. We found fees can vary widely, with some insurers charging more than double the average for certain fees.
There are fees to change your name or address, for paying monthly or by credit card, for setting up or renewing premiums and for cancelling policies.
The highest fee we found was £75. IGO4 charges this much if you want to cancel during the 14 day cooling-off period. Budget, Endsleigh and IGO4 all charge £75 for ending your policy early, whereas the average cost is £49.55. Age UK, NFU Mutual, Volkswagen and Volvo don’t charge any cancellation fees for ending a policy early.
With such a huge variation between providers, we want the companies using rip-off fees to justify why they’re charging such a high amount for what are, in some cases, simple policy changes.
All fees associated with setting up, amending or duplicating any type of insurance policy should be reasonable and no more than the cost to the company. We also want companies to set out all fees and charges clearly so you can easily compare between providers.
Our executive director Richard Lloyd said:
‘We want companies to ensure their fees reflect actual costs and aren’t just a way to squeeze more money from customers.’
If you agree and want to stop sneaky car insurance fees and charges, join more than 55,000 others by signing our petition.
If you can’t afford to pay annually for your cover consider using a 0% credit card (with at least 12 months of interest-free purchases). You may face a credit card fee, and it isn’t something you can do every year, but it should be cheaper overall.
Many companies charge you to make adjustments to your policy if you call them on the phone but allow you to change your policy online free of charge.
With car insurance being ultra-competitive you may be able to beat the fees by bartering. Call your insurer and haggle over the fees – even threaten to leave – and see if you can get them dropped.
We also have advice on finding cheap car insurance.
In good news for our Sneaky Fees and Charges campaign, Barclays has announced that it has simplified its mortgage fees.