Home Insurance Auto Renewal
Written by Karen Bryan
Althought I generally advocate shopping around to compare insurance quotes, the renewal price for our home insurance with Direct Line was only a few pounds more than last year. I’m happy with the cover, as it includes annual travel insurance for the same price that most companies charge for home buildings and contents insurance, which saves more than £60 a year on buying separate travel insurance. However this is qute unusual, as often companies offer you a great price for the first year’s home insurance policy then bump up the price in the second year.
Most insurance policies are set to auto-renew. This only came to light when I phoned Direct Line to ask them the renewal price they were going to charge me (as I hadn’t received anything in the post). I told them I was going to shop around before renewing with them and the customer service person offered to switch off auto renewal, warning me I’d have to re-contact Direct Line if I did decide to stay with them.
I reckon that you should start researching the best quotes price 2-3 weeks before you current insurance cover expires. If you find a better price with another company, make sure that you contact your current provider to cancel the policy with them, or you could end up paying two premiums. This could well make you overdrawn on your current account if you used your debit card to pay, or exceed your credit card limit if you paid by credit card. Either of these scenarios would mean penalty charges.
I never just buy the cheapest home insurance cover; I add contents temporarily away from home and legal cover. I also check out the excesses. There’s a standard £1000 for subsidence claims. I aim for a £50 excess for other claims, as I don’t want to be too much out of pocket if I have to make a claim.
I pay the premium as an one-off payment, as most companies will charge you extra to make monthly payments. As long as there’s no additional fee for paying by credit card, I”ll use this for payment in order to get cashback; I receive 3% on my Aqua Reward Credit Card so that saves more money.
This sounds like a familiar experience. Auto renewal is the scourge of the insurance industry and infects other products as well (auto renewal of antivirus software subscriptions is a particular bugbear of mine).
It’s refreshing to read a blog post that talks about staying with the same insurer for a second year (what a crazy idea, where’s the affiliate link commission in that!!?). Sometimes it’s nice to avoid all the hassle of changing insurer.
I’d still be tempted to run a search on a comparison website for a cheap quote and then phone up Direct Line with an empty threat to leave them. Even if they aren’t able to price match, they might offer some discount. Don’t ask, don’t get!