Small policy change, big costChanging insurance details comes at a premium
22 September 2010
Minor changes to insurance policies could cost as much as £55 a time. Insurance providers are imposing administration fees for alterations to policies, such as a change of marital status or address.
Which? Money has discovered that seven-in-ten car insurance providers and one-in-three home insurers will impose admin fees for small changes to a customer's policy. In some instances, the sums involved appear disproportionate to the work involved in making the alterations, which involved a minor amendment to a document that is then sent by email or post to the policyholder.
Research found that car insurers charge customers £21 on average for policy detail changes. Home insurers impose £18 on average for changes. Some insurers are charging £30 for additional copies of policy documents.
Tough luck for young drivers
Among the highest chargers are those who specialise in insuring young drivers - who tend to be paying high premiums in the first place. I-Kube, for instance, charges £55 for changes. On the home insurance front Bluefin charges a £35 fee for changes.
Cancelling a policy can also prove expensive. Which? Money found that consumers are losing significant percentages of their premium refund and facing fees of up to £85 for cancelling their insurance mid-way through their policy term.
Which? chief executive Peter Vicary-Smith said: 'Whether it’s £30, £55 or an £85 fee, insurance companies are going to have a hard time trying to justify the exorbitant charges they’re billing for routine tasks such as changing an address on a policy or providing duplicate policy documents.
'It’s about time insurance companies start treating their customers fairly and make administrative charges proportionate and transparent.'
Which? Money when you need it
You can follow @WhichMoney on Twitter to keep up-to-date with our Best Rates and Recommended Provider product and service reviews.
Sign up for the latest money news, best rates and recommended providers in your newsletter every Friday.
Or for money-saving tips, and news of how what's going on in the world of finance affects you, join Melanie Dowding and James Daley for the Which? Money weekly money podcast
For daily consumer news, subscribe to the Which? news RSS feed here. And to find out how we work for you on money issues, visit our personal finance campaigns pages.