Shop around for car insurance despite new transparency laws, warns broker

Requirement for insurers to include previous premiums on renewal notices may inadvertently lead to poor consumer behaviour

Jonathan Hehir, managing director of City Financial Marketing Group, said a reduction in a premium does not mean the customer is getting the best deal. 

Legislation aimed at creating more transparency around renewing car insurance could be hurting consumers’ pockets instead, an insurance broker has warned.

City Financial Marketing (CFM) Group, the firm behind online insurance brands including Insuremycars.ie and Insuremyvan.ie, said the requirement for insurers to include the previous five years of premiums on motor insurance renewal notices to combat dual pricing may inadvertently be leading to poor consumer behaviour.

Better quotes

As premiums have been reducing in recent years, motorists are viewing a fall in premium as a win and are not shopping around for better quotes as a result, the broker said.

“Just because your existing insurer is quoting you a better premium than last year’s, this does not mean it’s the best deal on the market and that shopping around is still as relevant as ever when it comes to securing the best value product on the market,” said CFM Group managing director Jonathan Hehir.

The legislation was introduced in the Consumer Insurance Contracts Act 2019 and calls for visibility of historic premiums. As a result, more people may lean towards auto-renewing their policy, which could end up costing them money.

“Motorists should ultimately be switching every two to three years,” said Mr Hehir.

“Our message is simple — if one insurer is reducing their price, you can be sure that many others are also doing so, as it has become a very competitive market. 

Even if your existing insurer has knocked €50 off your renewal premium, there’s a good chance that another insurer might knock €100 or even €200 off it, so it always pays to shop around.” 

Insuremycars.ie highlighted the issues with a recent example where a customer had been dealing directly with an insurer for the last five years and was about to renew with the same insurer, but decided to seek some advice first. They subsequently saved €144.

“In the example, the customer, an elderly motorist, didn’t accept the renewal of €671 from their insurer and called us instead. We sought quotes from 13 other insurers and secured a premium on the same terms for €527,” said Mr Hehir.

"We’re seeing it too often — motorists who have remained loyal to one insurer are invariably being offered a slightly lower premium this year and, thinking they are doing really well, are simply accepting it.”