The consumer organisation Which? has revealed a number of car insurance companies charge “eye-watering” extra fees on top of the cost of the premium, when others provide the services for free, included in the cost of the premium.
Which? found that some insurers were charging as much as £75 for policy cancellations, even during the cooling-off period. Some insurers charged £50 for renewing a policy, whilst duplicating documents would cost £30.
Which? looked at 44 car insurance companies in the UK and the fees they charged, as part of its study. One company, IGO4, was found to charge £35 for adjustment fees (which means things such as changing your address, job or even name), whereas five other companies did not charge at all for this service.
Most companies tended not to charge a fee for renewing a policy, but 1st Central charged £50 to do so. Another service which is normally free is duplicated documents being provided. However, Swiftcover and Axa Direct both charged a fee of £30 for this service.
“We’ve found some insurers charging customers eye-watering admin fees that can be hard to avoid. We want companies to ensure their fees reflect actual costs, and aren’t just a way to squeeze more money from customers,” said Richard Lloyd, of Which?
Some companies were also found to charge significantly more money than their competitors when customers paid for their car insurance monthly rather than annually.