The UK Insurance Blog

Received a press release this morning extolling the virtues of a new travel insurance product from a company named noclaimscashback.com. At first glance it seems a neat product, you pay for your travel insurance and then when you’re back home, provided that you haven’t made a claim, you get up to £10 of your money back. They compare it to the no claims discount that we get with motor insurance, whereas I tend to compare it with life insurance, you don’t get any refunds but you’re still alive !.

Anyhow, let’s take a closer look at the small print :-

• Single trips only - no annual policies
• Single person or couples only - no family groups
• Everybody has to be between 18 and 49 years of age
• No ski insurance available
• No insurance for people with pre-existing medical conditions

So, they’re cherry picking the very lowest risk travelers and are only offering single trip policies. We’ve always pointed out that the best value comes from annual policies, and that’s best value to you, the consumer, and thus lowest profit to the insurer.

Their pre-existing medical conditions clause of the policy isn’t awfully clear and I’d strongly advise anybody considering buying this particular policy to contact the company and double check if they are at all unsure. The relevant clause is

“The policy does not provide cover for any pre-existing medical condition. A medical condition is any medical condition which has been suffered or which is under review (routine or otherwise), or for which medication, advice or treatment has been received within the last 12 months (prior to the date your policy is issued). This includes long standing conditions as well as injuries.”

When I checked against a Churchill policy, Churchill restrict the medical condition to anything that caused you to be hospitalised within the last 12 months. There’s a big difference there. Also most companies will offer insurance (maybe restricted a little) to most people with pre-existing, long term medical conditions, it’s another instance of noclaimscashback  cherry picking the very safest clients.

My final thought on this policy is that it reminds me of the recent phone cashback scandal where people were promised their money back at the end of a one year term. The phone companies were expecting only a small percentage of customers to claim their money back. When something like 80% claimed their cash the company couldn’t pay and it left a very bad taste in the mouth. I’m not suggesting that there is any danger of noclaimscashback not returning money although I do worry that the terms for repayment are quite so strict in that you are offered up to £10 back provided that you claim it after one month and before two months of your return.

I’m sure that the policy will appeal to some people, myself I’m happy to get back from a holiday that went without incident or accident, travel insurance is money well spent and I hope to never have to make a claim.

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An article from the Press Association tells us that Halifax Home Insurance have come up with some startling facts about home restoration projects. It seems that almost three million rooms have vanished over the past five years as homeowners knock down walls to create open-plan living space. An estimated 2.9 million rooms have been knocked into adjoining ones in the past five years, while plans are being made for a further 2.1 million homes to lose at least one room this year, according to the Halifax research.

The most popular wall to knock down is that between the dining room and the living room, with many people believing that the traditional dining room is part of a bygone era. The days of the whole family sitting around a dining table adorned with the best china whilst tucking into roast beef and yorkshire pudding seem to be gone for good. It seems that people now prefer the extra living space that joining the two rooms brings.

Estimations show that a further 590,000 dining rooms will be destroyed this year to create bigger kitchens or lounges and that the traditional standalone dining room could be extinct by 2020.

Larger living areas are also being created by knocking through the walls between living room and hallway or getting rid of utility rooms or studies to get bigger lounges, kitchens, bathrooms and bedrooms.

The worrying point about all this alteration work is that one in four people are planning to knock down walls themselves rather than employ a tradesman. At the same time half of people who carry out work don’t realise that they have to inform their insurer that the number of rooms is about to change, and that failing to do so could invalidate their house insurance.

David Rochester, head of underwriting at Halifax Home Insurance, said: “Britons have clearly fallen for open-plan living and are looking at ways in which they can make better use of the space inside their homes. Not only do we urge homeowners to make sure a qualified person carries out any structural work to their home, we also recommend seeking the advice of a qualified structural engineer before progressing work to knock down any walls.”

We’ve all seen the Fawlty Towers episode where Basil gets in a local firm of cheap builders to knock down a wall, only to find that they’ve removed a major retaining wall and the whole place is likely to collapse at any moment. Nobody is suggesting that such a farce could take place in your home but insurance companies get hundreds of claims each year for collapsed ceilings etc that are the result of people taking down the “wrong” wall, and the insurance companies simply don’t pay out on those claims, so be warned.

The Guardian reports that new Department of transport figures are showing horrific statistics for the two wheelers amongst us. Bikes constitute just 4% of the vehicles on our roads but their riders account for nearly a third of all road deaths. Car drivers are getting safer as designs improve and cars are fitted with air bags to reduce risks in an accident. Bikers are still fitted with a fibreglass bonnet to protect them, it’s an unequal struggle.

Statistics show that a motorcycle or scooter rider  is 50 times more likely to be killed or seriously hurt than a car driver for each mile travelled, and twice as likely as a pedal cyclist.
Insurer yesinsurance.co.uk says the recent trend for inexperienced middle-aged men to ride motorbikes is contributing to accident numbers. Deaths and serious injuries to riders in their forties have doubled in the past ten years compared with a fall in the younger age brackets.

Paul Purdy of YesInsurance believes that the steadily increasing price of fuel and the fact that two wheeled vehicles  are exempt from paying the London congestion charge have been two of the factors encouraging car drivers to switch to motorcycles.

I know that many bike accidents are the result of car drivers doing stupid or inconsiderate things BUT you’ve got to ride defensibly, expecting the worst of all motorists and truck drivers. It’s no good laying in a hospital bed with broken bones or worse and explaining that a motorist pulled out and didn’t see you. He’s got a dented vehicle, you’ve got a broken body…or worse.

There was a general feeling in the office that residents of Northern Ireland were getting heavily penalised when it came time to renew their motor insurance. Now that peace has returned to the Province and everything has been quiet now for several years, we were wondering if and why the people of Northern Ireland were paying over the odds for their insurance. We decided to do a little experiment to see how much difference your location makes to car insurance premiums.

Meet David Stone (Dave to his friends). He’s a married man born in 1966 with a squeeky clean license, never in trouble with the police and with 5 years no claims discount. He’s just bought a 2005 Ford Focus 1.4 LX for the knock down price of £7,500. He’s a model citizen, well he certainly should be because we invented him a few days ago. He tends to move around the country a bit, but apart from that he’s your absolutely normal, totally fictional guy. Let me explain. We wanted to put identical details into a selection of online car insurance sites to see how big a difference there is in premiums depending on your location. Please try to remember that we’re not comparing premiums between companies, some of them might well be offering extra facilities such as roadside recovery or protected NCD in their prices, all that we are comparing is the difference in price from the same insurer when we move Dave around the country.

Remembering that our original task was to prove that the car drivers of Northern Ireland were being unfairly treated and armed with street maps (kindly provided by Google Maps), we looked around for likely “dodgy” locations.

Not knowing Belfast at all we plumped for Newforge Lane which is a mile or two to the south of Belfast city centre (and probably very plush and not “dodgy” at all, but you’ll understand the “dodgy” reference in a minute).

Our next location was Bold Street in Manchester. It’s in the Moss Side part of the city which gained notoriety across Britain during the 1980s and 1990s due to high crime levels and several riots.

Next we moved Dave to Electric Avenue in Brixton, London. Brixton has long been associated with gun crime, poverty, drugs and violence and is often classed as London’s Compton or Harlem. It has the reputation of being one of the most dangerous places in the UK, with Coldharbour Lane once holding the statistic of 3 shootings per week in the mid-90’s. It is a place any visitor or inhabitant alike, would be wise to not venture around at night.

Our final resting place needs a little explanation. One of the leading UK insurance companies, Endsleigh, did a report on the best and worst cities for motor accidents and car theft. In the report, Belfast is the safest for accidents and Hull is the worst for theft by a considerable margin. So Hull it was to be, in fact Anlaby Road in Hull which looks to be pretty much in the centre of town.

OK, back to the plan. Dave was going to get quotes for comprehensive car insurance from a variety of insurers, each time getting 4 quotes, one for each location. All other details input would be exactly the same for each insurer and for each location. By doing this we should be able to see if car insurance in Northern Ireland has excessively high car insurance premiums.

The results surprised everyone in the office and I think they’ll surprise you. The variance between insurers is amazing and if we learn one thing from this exercise it should be to shop around before parting with your hard earned cash. A bad address to one insurer seems to be treated as perfectly ok by another, there’s no rhyme nor reason for some of the differences. Let’s go ahead and look at some of the results.

We started by trying to get quotes for the Northern Ireland address from our sister site Instant Online Insurance. There are a number of direct insurers on there such as Direct Line that don’t appear on the car insurance comparison websites. The results are in the following table.

Car Insurance Premiums vs Location

Please remember that the object of this exercise was to show the differing rates charged for car insurance depending on where you live. Our original intention was to confirm that people living in Northern Ireland were getting a raw deal on their car insurance premiums. As you will see below, we were probably some way off the mark but what the figures do prove is that it pays to shop around when buying car insurance and that each insurer seems to have their own ideas on which are both the safest and the most dangerous areas in the country.

Direct Insurers

These are the online direct insurers that tend not to appear on comparison websites.

_{Notes
1) Privilege, MORE TH>N and Churchill wouldn’t insure our Northern Ireland resident.
2) Endsleigh don’t seem to have much confidence in their own research, Hull is half the price of Manchester
3) MORE TH>N were a complete pain in the whatsit. Their quote process crashed 3 or 4 times and when we did eventually get to the end they wouldn’t insure us.
4) Since Dave was just about the most perfect virtual motorist we could invent, you’ve got to assume that Privilege, MORE TH>N and Churchill don’t insure anybody in Northern Ireland, in which case why don’t they turn you down as soon as you enter your address. It’s frustrating to get to the end of one of these online car insurance quote forms only to be told “sorry”.
5) Judging by the premiums quoted by the companies willing to offer insurance in Northern Ireland, the risks are no greater than in many parts of England, so let’s hope that a few more insurers will begin to offer car insurance for Northern Ireland residents.}

Car Insurance - Compare The Market

This table is the result of putting 4 different addresses into the quote engine with exactly the same proposer details, only his address is changed each time.

Compare The Market

_{Notes
1) As in the previous table there were a number of companies that wouldn’t quote for Northern Ireland even though they quoted for our other locations. They are at the bottom of the list
2) Royal & Sun Alliance didn’t quote for Hull but it may just have been a server failure rather than their unwillingness to quote.}

So once more we don’t really see a positive sign of discrimination against the people of Northern Ireland and would hope that some of those companies that chose not to quote might be willing to dip their toe in the water before too long.

What was reinforced most strongly was that it’s imperative to shop around for car insurance quotes before committing to a particular insurer. These companies have hugely differing views on safe and unsafe areas and we should take advantage of that by saving lots of money on car insurance premiums.

Our next little survey will involve Bob the Builder and his search for cheap home insurance and soon afterwards Rover the Dog will be imparting some wisdom on pet insurance. In the meantime, if you’d like to tell us about how low or high your insurance premiums are then hit the comment button and drop us a line. Don’t give your full address, just a post code is fine. So if you think that you have the cheapest premiums in the country in your area please let us know. Oh and if you’re insured with Norwich Union please give us the post code, at the moment we have the feeling that with those prices they’re either not looking for motor insurance or perhaps they’re just on a different planet ?.

Ross