General insurers should provide clearer information on previous years premiums and renewal quotes to empower customers to shop around, a Which? survey has suggested.
As a result, the consumer body is today launching a campaign calling on insurance companies to show last year's premium alongside renewal quotes and explain any differences. Without this information people lack the incentive to shop around as they are not able to easily see if they are paying more and why, claimed Which?
Two-thirds (68%) of the 2,065 UK adults polled said having last year's premium would prompt them to look for a better deal with other insurers, and a similar proportion (64%) said they would be more likely to haggle for a discount with their current insurer if they have this information.
Almost nine in ten (85%) of those surveyed are in support of having their previous premium on their renewal quote. Sixty-two per cent said they find it 'annoying' that it is not included, while only 7% agree that it would be hard for companies to do.
Which? executive director Richard Lloyd said: 'Our research shows it pays to shop around when renewing your insurance, and that's good for all consumers too as it helps keep the market competitive. But it's not easy to find a good deal if you don't know what you paid last year.
'People have told us that if insurers made it easy to find out the cost of their old premium it would prompt them to look for a better deal or haggle for a discount. So we're asking people to support our campaign calling for all insurers to be more upfront when they send out renewal notices by showing customers the premium they paid last year and explaining any differences.'
Which? has also asked insurers to provide customers with their numbers of years of no-claims-bonuses and make sure renewal letters are received by the customer at least three weeks before the insurance is due to renew.
Responding to the call, Huw Evans, director of policy at the Association of British Insurers, said: 'Insurers agree that it is important for customers to take advantage of a competitive insurance market and shop around and most already do.'
Almost three quarters (73%) of customers have shopped around for motor insurance, and 75% of people shopped around for a home insurance provider, Evans added, citing figures from an ABI poll.
'But renewal should never be just about price; getting the right cover for your needs is vital. We look forward to continuing to discuss with Which? and other consumer groups how best to help customers make informed choices about the best cover for them.'
