dug 
Our car insurance is coming up for renewal and we’ve just received a letter from the Cooperative (co-operativeinsurance.co.uk) stating they won’t consider renewing our insurance because we had a claim (wife slo-mo drifted into another car in the snow last winter).
Now given a privately funded insurance market I’m happy for actuaries to evaluate risk and set contract details accordingly. I would expect in our case that the risk evaluation would mean that in order to renew our policy, they would need to increase our premium.
This is where things start to get sticky. They couldn’t increase our premium because we had taken out a no-claims-bonus protection policy with them.
Excuse me?
Yes… we paid Cooperative money in order for them to insure our no-claims bonus so we made a claim thinking we were protected. Clearly not, this is essentially like taking out home insurance and then when your house is struck by lightning the insurance company saying that your home is insured but they wont fix your broken property because you live on a street where lightning has been shown to strike.
I just love the stuff the insurance industry comes up with to screw the consumer:-)
In any case, I’m taking three thoughts away from this little adventure:
- We need to come up with a legislative framework that decouples the legal requirement for insurance cover and the profit generated from the sale of that cover. In other words, we, as tax-payers need to pool our resources and fund a minimum third-party insurance cover scheme independently of the insurance industry.
- Don't take out a no-claims-bonus protection policy unless you have it in writing the policy with be renewed after a claim
- Don't assume you will be treated fairly by a company simply because they were praised by Which
Right, back to work…