One of the consequences of COVID-19 and the lockdown has given car owners reduced premiums but premiums for home and contents insurance are actually rising, partly due to increased claims for accidental damage because we are spending more time at home.
Consumer Intelligence estimates that the cost of insurance rose 0.5% during the last three months, which demonstrates the cost acceleration, particularly when the rise over the previous six years has been only 2.3%.
With the increase in premiums two things are likely to happen. First, there is a strong likelihood of policy cover levels being reduced or even cancelled because of the rise in premiums. Alternatively, customers can sleepwalk into automatic renewals not realising until it is too late that the monthly cost has escalated.
How you can help your customers?
If you don’t want to lose your customers to one of the many price comparison sites on the internet, schedule a catch up call or Zoom meeting around a month before their policy is due to renew to let them know you will do all the hard work for them and come up with the most suitable alternative quotes that meet their requirements today.
Remember that customer circumstances change and what worked for them last year might not be ideal for the coming period of cover. It could be that you missed out on arranging cover for them last time it was due, to an insurer pricing to win new business and that same insurer may be looking to increase premiums at renewal to make up the difference. Look to quote them again this time.
If you arranged cover last time, the current insurer might still be the best and renewal commission will be well earned if you have checked suitability thoroughly. Cost wise, customers will thank you if you can show you have saved them money or you are able to remind them of the true value of cover with the policy they have.
There is nothing wrong with renewing an existing policy, as long as it still provides the right cover the customer needs and value for money.
If your customers are able to pay annually, they can make savings as typically an amount of interest is added to the premium for the flexibility of paying monthly. If your customers do need that flexibility of spreading the cost over the year, look at the interest that is charged. Assurant charges 7.5% interest which is one of the lowest in the market but other providers can sometimes charge as much as 40%.
You can help and guide your customers through your advice in many ways and reviewing their home insurance is just one area.
Get in touch and let us help you.
03332 000 444