Our car insurance renewal quote is up a monster 46.5% – the loyalty penalty strikes again

Our car insurance renewal quote is up a monster 46. 5% – the loyalty penalty strikes again Last year, majority of motorists saw large rises in auto-renewal quotes Insurers hid behind ‘cost of labour’ excuse – and are still doing it Loyalty penalty appears worse than ever, despite FCA promises By Lee Boyce for Thisismoney. co.

uk Updated: 01:00 EST, 11 January 2024 e-mail View comments Your car insurance renewal quote is likely to be higher again this year. Well, if the quote received by Mrs B and I recently is anything to go by. Sorry to be the bearer of bad news.

Last year, I wrote about how the auto-renewal quote for our 2019 Skoda Karoq had ballooned 21 per cent despite no change in circumstances. That came after a decade of loyalty with insurer Diamond. There was no budging on the quote, so we went through a comparison website and found a far better deal with Churchill.

So here we are again in January. The renewal quote landed on the mat, and I opened it with trepidation. What was the damage going to be? Surely not as big a leap as last year… Monster jump: We’re insuring a five-year old Skoda Karoq – so why the 46.

5% leap in premiums? Once more, there is no change of circumstances, the car is the same, no claims, same address, the vehicle has more miles on the clock so worth less, same miles driven, another year of the fabled no claims bonus. All of that information was presumably crunched and the quote was up, wait for it… 46. 5 per cent to £463.

20! Last year was easily the biggest auto-renewal quote bump we’d ever had, but this year’s one makes it look miniscule. A monster truck leap this year versus an SUV-sized one last year. RELATED ARTICLES Previous 1 Next Rise in drivers being dazzled by headlights: RAC blames.

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. . Share this article Share HOW THIS IS MONEY CAN HELP How to save money on car insurance: Ten top tips to cut the cost in just a few minutes Let’s rewind to January 2022 when the City watchdog said it was going to collectively save Britons billions of pounds by banning the insurance loyalty penalty.

What on earth is this then? Some way to treat loyalty. I thought the idea was to ban insurers auto-renewing customers onto higher premiums for a like-to-like policy, hoping to catch them out and all the while, offering new customers better deals. Last year was easily the biggest auto-renewal quote bump we’d ever had, but this year’s one makes it look miniscule.

A monster truck leap this year versus an SUV-sized one last year. We put our details through a comparison website, found cheaper quotes and went into battle with the Churchill call centre. What would the justification be for such a large bump? ‘The cost of labour has gone up’ was the armour the call centre staff member hid behind.

The very same excuse that was spat out last year. How much longer can insurers hide behind that line? I understand that labour and parts have become more expensive, but I understood that last year. Will the same line be trotted out next year? What specifically has become more expensive for our Karoq? There wasn’t much in the way of elaboration.

We asked if there was any wiggle room at all. The staff member disappeared for a moment, our hopes fading. She returned and said: no.

That was that. When we bought the car brand new, the insurance cost was £396. 48.

A year later, it fell to £363. 59. In January 2021 it went to £400.

15 and in January 2022, a similar figure. We will of course just go to another insurer. Is the Financial Conduct Authority watching? Who knows.

I wrote late last year how households are typically paying £264 in Insurance Premium Tax annually (through car, home, pet and travel cover). In 2022/23, the Treasury raked in £7. 45billion from it, compared to £2.

97billion in 2014/15. It’s time for the Government to seriously consider lowering the 12 per cent IPT rate. If you were hoping the insurance haggle dance games of 2023 were over, my early litmus test case suggests you’re going to be sorely disappointed.

Your no claims bonus record is pointless, your no-change in circumstances doesn’t matter and above all, loyalty counts for nothing. In fact, in this case, we haven’t even been given the chance to build any with the brand synonymous with the nodding dog. If you need some help getting a better deal, we’ve got you covered: How to save on car insurance: Ten top tips to cut the cost in just a few minutes SAVE MONEY, MAKE MONEY Isa and Sipp offer Isa and Sipp offer Up to £3,500 transfer cashback* HL’s biggest ever cashback offer Easy access deal Easy access deal Competitive 4.

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15% interest on one-year fix* Open via Raisin UK platform with £1k Fibre broadband Broadband £80 bill credit on sign-up* 18 months at £26. 50 per month * Affiliate links: If you take out a product This is Money may earn a commission. These deals are chosen by our editorial team, as we think they are worth highlighting.

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