Retirement
Government review finds insurance renewals cost more than switching
Retirement
Government review finds insurance renewals cost more than switching
The NSW government’s independent statutory authority for consumer protections has found that consumers renewing their home and contents insurance are paying more than those opting for new policies.
Government review finds insurance renewals cost more than switching
The NSW government’s independent statutory authority for consumer protections has found that consumers renewing their home and contents insurance are paying more than those opting for new policies.
In his September Quarterly Report, NSW Emergency Services Levy Insurance Monitor Professor Allan Fels highlighted that, on average, the base premium price of home and contents renewal policies is 27 per cent more than that of new policies.
He revealed that even though, in most cases, the sum insured is higher with renewal policies, the price to renew is still more expensive on average after adjusting for this fact.
“This is what is referred to as a loyalty tax, where consumers are penalised for remaining with a company and their product,” Professor Fels said.
“It seems that like banks and energy companies, insurers count on the loyalty of existing customers to offer discounts to new ones.
“This really translates to a simple message for consumers – don’t assume you are getting the best deal with your renewals. Always check the prices of other suppliers, and if your insurer is out of line, go elsewhere.”
Professor Fels recommended insurers be required to disclose the prior year’s price on renewal notices as a measure to improve transparency and promote consumers to assess the price offered to renew.
The Insurance Monitor has informed insurers in NSW that they must reveal last year’s premium on renewal notices by 1 July 2019.
“Insurers decide how much ESL they charge their policyholders. We are asking insurers to show their customers how much of their premium goes to the insurer and taxes, and how these charges change each year,” said Professor Fels.
Matt Kean, NSW Minister for Better Regulation, said he is disappointed by the findings.
“Loyal customers should be rewarded, not ripped off by their insurance providers,” he said.
“We know some big businesses try to take advantage of customers by making it hard for them to change providers or get out of their contracts.
“This is simply unacceptable.”
Overall, the Insurance Monitor’s September Quarterly Report found that ESL rates dropped in the September quarter, but some consumers continued to experience rises in ESL compared with the previous year. This was attributed to insurers re-establishing ESL rates at various stages.
Retirement Planning
Empowering your future: Financial literacy and retirement planning in Australia
In today’s complex financial landscape, achieving a secure and comfortable retirement requires more than just saving money. It demands a deep understanding of financial concepts and the ability to ...Read more
Retirement Planning
How much do you need to retire comfortably in Australia?
Retiring comfortably in Australia is a goal shared by many, but achieving this requires careful financial planning and a clear understanding of the cost of living. Read more
Retirement Planning
Retirement planning advice for Australians: Avoiding common pitfalls
Retirement planning is a critical step in securing your financial future, but it's fraught with potential pitfalls that can derail even the best-laid plans. Read more
Retirement Planning
Mastering financial planning for retirement in Australia
Financial planning for retirement is a nuanced journey that requires careful consideration and strategic planning, particularly in Australia's unique financial landscape. Read more
Retirement Planning
Crafting your retirement planning spreadsheet in Australia
Retirement planning is a crucial aspect of financial management, especially in Australia where the landscape of superannuation and investments offers unique opportunities and challenges. Read more
Retirement Planning
Maximising your pension plan in Australia: Strategies for a comfortable retirement
In the ever-evolving landscape of retirement planning in Australia, securing a comfortable retirement through your pension plan has become increasingly important. Read more
Retirement Planning
Supporting our veterans: A guide to financial resources and benefits
Military veterans have made invaluable contributions to their country, and in recognition of their service, there are numerous financial resources and benefits available to support them in civilian ...Read more
Retirement Planning
The ultimate retirement planning checklist for Australians
Retirement planning is a multifaceted process that demands careful attention to financial, legal, and personal considerations. Read more
Retirement Planning
Empowering your future: Financial literacy and retirement planning in Australia
In today’s complex financial landscape, achieving a secure and comfortable retirement requires more than just saving money. It demands a deep understanding of financial concepts and the ability to ...Read more
Retirement Planning
How much do you need to retire comfortably in Australia?
Retiring comfortably in Australia is a goal shared by many, but achieving this requires careful financial planning and a clear understanding of the cost of living. Read more
Retirement Planning
Retirement planning advice for Australians: Avoiding common pitfalls
Retirement planning is a critical step in securing your financial future, but it's fraught with potential pitfalls that can derail even the best-laid plans. Read more
Retirement Planning
Mastering financial planning for retirement in Australia
Financial planning for retirement is a nuanced journey that requires careful consideration and strategic planning, particularly in Australia's unique financial landscape. Read more
Retirement Planning
Crafting your retirement planning spreadsheet in Australia
Retirement planning is a crucial aspect of financial management, especially in Australia where the landscape of superannuation and investments offers unique opportunities and challenges. Read more
Retirement Planning
Maximising your pension plan in Australia: Strategies for a comfortable retirement
In the ever-evolving landscape of retirement planning in Australia, securing a comfortable retirement through your pension plan has become increasingly important. Read more
Retirement Planning
Supporting our veterans: A guide to financial resources and benefits
Military veterans have made invaluable contributions to their country, and in recognition of their service, there are numerous financial resources and benefits available to support them in civilian ...Read more
Retirement Planning
The ultimate retirement planning checklist for Australians
Retirement planning is a multifaceted process that demands careful attention to financial, legal, and personal considerations. Read more