Henry Smith MP has given his support to a MoneySuperMarket campaign to save Crawley drivers over £2.3 million on their car insurance.
Henry said;
“It’s unacceptable that drivers in Crawley are losing £2.3 million because of unfair practices by the insurance industry. This is money that many can’t afford to waste. 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 this doesn’t happen.”
Research by price comparison website MoneySuperMarket has found that 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.
Henry 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.
The Financial Conduct Authority is set to report on the use of auto-renewals in the motor insurance market; Crawley drivers could save £2.3 million by not being auto-renewed
Dan Plant, Editor-in-Chief at MoneySuperMarket, commented;
“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.”
The report from MoneySuperMarket report highlights poor practices of insurers, revealing that people often have no idea that they are 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.
Cancelling an auto-renewed policy can be difficult and costly, with some providers 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.
Additionally, 62 per cent of consumers say auto-renewals deter them from shopping around for a more affordable policy. 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.
External links:
MoneySuperMarket
Motor Insurance Auto-Renewals (MoneySuperMarket report)