Contact your clients now, before the likely hike in insurance premium tax, to discuss securing them a better renewal deal
The issue of renewal pricing in the home insurance sector continues to come under the spotlight. It has been confirmed that renewal notices issued after April 2017 will have to include details of the premium price the customer is currently paying as well as the price they will pay on renewal, to enable them to change provider if their renewal price is too high.
We welcome this move, which should be in place before next spring.
Unnecessarily hiking insurance premiums upon renewal – and in such an underhand fashion – is a foolish move by providers, and a dangerous one. If clients feel duped into paying higher prices, they may cancel policies altogether and leave themselves unprotected. Insurance is a hard enough sell without consumers feeling they are being tricked.
Providers that have taken part in this practice have made renewal sales difficult for the industry as a whole. And now those sales could become even more difficult because another hike in insurance premium tax is on the cards for 1 October, climbing to 10 per cent following last year’s hike from 6.5 per cent to 9 per cent.
If clients deem their renewal price too high and opt instead for inferior cover or, worse still, no cover at all, they could put themselves in a dangerous position, particularly with the winter months around the corner.
The autumn months – September, October and November – are traditionally the most popular for renewals, both residential and commercial. Take the opportunity to contact your clients now, before the IPT hike, to discuss renewing their policy. Let them know that premiums are likely to rise, albeit marginally, from October and you want to enable them to secure a better deal.
They will appreciate the fact that you are helping them to save money, and will be more likely to give you their business – and, indeed, future business – as a result.
Jason Berry is director of sales at Uinsure