'Hidden' insurance fees exposed

By // News | 'Hidden' insurance fees exposed
Email to a friend Plain text Print version // Font size: Decrease font Enlarge font
15 April 2012 Last updated at 11:00 ET
Traffic in wing mirrorThe report criticises insurance companies for failing to make charges clear to customers

Drivers and homeowners are being hit with "exorbitant hidden fees" for basic insurance policy changes and renewals, the consumer group Which? has revealed.

The watchdog uncovered costs of up to £30 for simple alterations - such as changes of address and vehicle, and updating personal information.

Customers are also being charged for cancelling and renewing their policies.

But insurers say the industry is "committed" to keeping prices "as low as possible".

The data came from a review of the terms and conditions on the websites of 39 car, and 34 home insurers.

In the report - which appears in the May edition of its magazine - Which? criticises home and car insurers who "appear to be taking consumers for a ride" by failing to make charges clear and accessible.

It found "many insurers" did not publish details of fees on their websites - "making it near impossible for prospective customers to make an informed choice or compare like for like".

In particular, the report says some insurance companies - such as Axa and Swiftcover - charge a flat fee of £30 to clients only wishing to update their address, married surname, or vehicle covered.

Which? also found a number of insurers charging "excessive amounts of interest" to customers paying in instalments instead of upfront.


Sarah Bailey, from the Association of British Insurers, said it was important for customers to "understand what they are buying" and "read the policy carefully".

"There can be a balance between a lower overall price and higher charge for a change."

She also said paying by instalments cost insurers money because it reflected an "increased financial risk", adding there was "evidence to suggest that those customers choosing not to pay in full for their policy upfront are more likely to make a claim".

"Insurers are committed to keeping administration costs as low as possible, but where they do incur costs that they cannot absorb then these may have to be passed on to customers," she said.

But Which? chief executive, Peter Vicary-Smith, criticised a lack of transparency from insurers: "It's a disgrace that insurers charge exorbitant fees to make basic changes to a policy.

"These charges should reflect the real cost to the company and not be a way of making easy money from consumers who are already struggling with high and rising insurance premiums."

"We want insurance companies to be clearer about the fees that they charge and stop hiding the details away in pages of terms and conditions," he added.

He also urged the new industry regulator - the Financial Conduct Authority - to "ensure that any charges reflect the actual cost incurred by the insurance provider".

The insurance company Swiftcover also commented on the findings: "When it comes to and 'hidden charges', as Which? puts it, they have simply got it wrong.

" has always been an online-only insurer, allowing customers to change their policy online whenever they wish, and as often as they need to - without charge.

"If, however, a policyholder chooses to update their policy by speaking to the help desk, there is an admin charge of £30, like with many other insurers."

A spokeswoman for Axa said: "Both Axa's and Swiftcover's home and motor policies are sold 100% online, and if your circumstances change (for example, you move house or need to add a second driver), you can update your details online and at a time that suits you, at no charge".

Tagged : No tags for this article

Headlines Newsview all

Amanda Holden at the centre of Twitter backlash as she sends daughter to school dressed as Pretty Woman prostitute for fancy dress day

A parenting group has slammed TV star Amanda Holden for posting a picture of her nine-year-old daughter 'dressed as a prostitute' online.The Britain's Got Talent ... Full story

Grandmother filmed confronting militants and branding them 'devils' before quoting verses in the Koran that forbid slaughter

An incredible video has emerged showing the moment an elderly woman bravely confronted two Islamic State militants, telling them their terror group is cursed and ... Full story

Jobseeker shocked to be sent rudest rejection email ever calling him an 'old, aesthetically challenged professional pr*** with no teeth'

A jobseeker was shocked after he was branded as 'irritating', 'rude' and 'obnoxious' in a cutting email accidentally sent to him by a prospective employer.James ... Full story

Youngsters turning their backs on binge drinking with 40% surge in teetotal teens and students

Teenagers and young adults are turning their backs on binge drinking, dramatic new figures have revealed.The proportion of teetotal 16-to-24 year olds has rocketed by ... Full story

Talented 18-year-old pianist who had won a place at Cambridge University was killed by a train after suffering a lapse into deep depression

A gifted 18-year-old pupil who had won a place at Cambridge University was killed by a train after suffering a lapse into 'deep depression', his ... Full story

Former PE teacher, 91, becomes oldest person ever sent to prison for the first time after being found guilty of string of sex attacks on boys

A 91-year-old former teacher has become the oldest person to be sent to prison for the first time after he was jailed for carrying out ... Full story

Beauty therapist who posted dozens of weight loss selfies showing off her new slim figure on Facebook is reported for encouraging nudity

A beauty therapist who posted dozens of 'selfie' pictures of her new slimline figure on Facebook said she was shocked and upset after being reported ... Full story

Parents slam former Ofsted boss Zenna Atkins who is now chair of school governors over x-rated messages she posted on public Facebook page

Parents have slammed a former Ofsted chief who is now chairman of a school's governing board over x-rated messages she posted on Facebook.Zenna Atkins, who ... Full story

Taxpayers forked out £2,300 a month for council boss on £195,000 a year salary to drive luxury Porsche

Taxpayers paid out more than £2,300 a month for a council chief executive on a £195,000 a year salary to drive around in a luxury ... Full story

30 signs YOUR relationship has hit the comfort zone (and will go the distance)

Do you go au natural around your partner, chat to them while naked and do their laundry? You've officially hit the comfort zone.New research reveals ... Full story

Number of Muslim children in England and Wales doubles in a decade with one in 12 school pupils now brought up in Islamic home

The number of Muslim children in England and Wales has doubled in a decade, according to the most detailed study of its kind.An analysis of ... Full story

Comment on: 'Hidden' insurance fees exposed

Rate this article


Featured author

Robert Livingston

Breaking News

Michelle Knight releases music video inspired by time as Ariel Castro's prisoner

The Cleveland kidnap survivor has released a song – entitled Survivor – about the 10 years she spent locked up in Ariel Castro's homeKnight, 34, ...

'There are some dreadful people at the BBC but it's my own silly fault I was fired': Clarkson blames himself for losing his Top Gear job after he punched producer in a row over food

Presenter Jeremy Clarkson has admitted sacking was his own 'silly' faultHe broke his silence on the hot food 'fracas' on BBC Radio 2 this morningBut ...

Hatton Garden heist police charge eight men with conspiracy to burgle

The group of eight dubbed 'Dad's Army' are all aged between 48 and 76The men were arrested in raid of 12 addresses across London and ...

Male child care worker, 24, 'indecently assaulted' two-year-old girl while she slept at the centre

A child care worker has been charged after 'assaulting a two-year-old girl'The child was sleeping when another worker witnessed the assaultDetectives from Bankstown Child Abuse ...

ISIS take full control of Palmyra, Syria, seizing air base, prison and spy HQ

Jihadis have entered 2,000-year-old ruins but no reports of destruction yetMilitant hails capture, saying: 'Praise God, (Palmyra) has been liberated'First time ISIS has claimed city directly ...

Ainsley Harriott - the new face of the £20 note? Thousands sign petition to get celebrity chef's image on banknotes when it is changed next year

More than 3,000 people have lent support to tongue-in-cheek campaign Bank of England asks public to nominate Briton to replace Adam SmithHarriott is praised as 'oily ...

Tubular Bells' Mike Oldfield's son Dougal dies suddenly at the age of 33

Harrow-educated Dougal Oldfield died of natural causes on SundayCollapsed at work where he was an editing assistant at a film companyDougal is one of ...

Mother fights to have Body Shop's explicit 'naked man' poster removed from stores after it reminded her daughter of the sexual abuse she suffered as a child

A mother has called for an explicit advertisement campaign to be bannedThe mother and her foster daughter were confronted by a poster, which featured a man's ...

Paul Zone's 1970s NYC photos alongside rockstars, drag queens and drug addicts

The vibrant music scene of mid-70s NYC is celebrated in a new book of never-before-seen photographsPlayground: Growing Up In New York Underground features some of ...

Tragedy as gap year teenager dies trekking in India: Heartbroken family speak of a 'beautiful, caring girl'

Niamh Campbell collapsed while trekking through remote part of India19-year-old was taken to hospital in Manali and later pronounced deadTravelled to India in September to ...