My original post indicated I was seeking renewal from Saga. My current insurer was the AA and it was only after seeing their 22% increase for my pending renewal on 23rd. August that I sought a quote (not a renewal) from Saga which brought to my attention their three year guaranteed premium offer which I found involved an annual premium of £700+ and for which they wanted to take my first £700 one month before the policy would start - them sitting on my £700 for nothing for a month is the whole nub of my complaint, not so much the 22% increase in renewal premium from the AA.
Because I saw Saga's policy of at the least sharp practice I wrote to my MP (Tim Farron) and see below copies of correspondence to date.
I’ve just asked for a motor insurance quote from Saga. They are promoting a fixed three year premium package ( by the way it will no longer continue to be fixed if your circumstances change, e.g. accident, claim etc. - they reserve the right to adjust.)
My renewal is due on 23rd August - I spoke to them yesterday 24th July.
The renewal premium (supposedly fixed for three years) was in the region of £700.
I was asked to submit card details for payment. I asked when would they debit my card? “Straightaway" they replied. I protested ssying that meant they would have my £700 for a month for which I would receive no value. The lady sympathised and left me on hold whilst she went to consult a manager. She came back confirming their take-it-or-leave-it policy. She pointed out that I would have the (very tenuous in my opinion) advantage of securing their wonderful offer which could possibly be withdrawn in the intervening period.
I am not a lawyer but sitting on somebody else's money for a month and giving no value is verging on the criminal. Their suggestion that I could have some value in guaranteeing their offer in case it was withdrawn in the intervening period is worthless - I would just cancel and go elsewhere, BUT in the meantime I would be running the risk of them going bust before my cover starts. At the least this is sharp practise of the highest order coming from an organisation that promotes itself as a specialist in giving sympathetic service to the elderly who, unfortunately, are the group most likely to be taken in by this malfeasance.
There should be some legislation to prevent this common practise - it is not the only organisation I have noticed operating a similar policy.
On 29 Jul 2019, at 11:50, firstname.lastname@example.org wrote:
Thank you very much for your recent email with regard to seeking a Saga insurance policy and the somewhat dubious practice of asking for your money a month in advance as a way to lock in a deal when the policy is not active for a further month.
It does, as you point out, seem rather beneficial to the company and not the prospective policy holder. I am pleased to confirm that I have written to the Chief Executive of Saga to share your example and to ask whether this is standard practice at Saga or across the insurance industry as a whole and whether they would honour this price but agree to take payment near to or on the day of policy initiation.
I will write again, when I have received the response.
With best wishes
Thanks for your reply. I am impressed and pleased that you have taken the trouble to pursue this further. I look forward to hearing from you when you receive a reply from Saga. I have, as you may guess, arranged insurance now with another company.