“I’ve been with AA car insurance for a number of years now,” starts a mail from a reader called Caroline. “I drive a 2012 Polo and use it for personal use only. I have a full driver’s licence and no penalty points. I have never had an accident and have never had any cause to make a claim. The car has no modifications and rests in secure underground parking with an alarm and immobiliser.”
Her car insurance cost €420 last year. “The renewal notice that came in this year was for €731. That’s a 76 per cent increase. I called to query it and was told by the renewals team that “insurance has gone up” and some mumbles about EU regulation, meaning that women couldn’t get cheaper insurance any more. I asked if there was anything that could be done, and the general answer was ‘Let’s take a look but it will be more expensive than last year.’ ”
She asked a friend what her insurance was. It was about €400 with a different company. “We got curious. She called the AA’s line for new business. She’s not an AA customer so there was no customer file to click into; they had to do a ‘from scratch’ quote for her. That’s where it got interesting. She gave my details on age, car, location etc and was given a new business quote of €421. I got on the line and asked if the same figure could be extended to existing customers – me. I was told no. I asked if I could cancel the existing policy and become a ‘new’ customer. I was told no.”
She was transferred to the renewals team; they could only work off the €700-plus quote.
"I was back to square one, so it was a short call after that point. And yes, our amateur detective work was found out, but really the only red faces should have been on the AA's part. I called Allianz and got a quote for €430. I've taken it. My Polo and I will be happily insured for some more adventures. But all joking aside, a couple of things leave me stunned."
She says the AA “obviously deal with new versus existing customers in very different ways – and customer loyalty, for all the advertising on same, seems absent. The ‘dance’ of having to call and negotiate down a renewal quote is a horrible waste of time. But more than that, it also tells me the rates being quoted for renewal aren’t accurate by a long stretch. If a competitor can give me a market rate that’s in the same ballpark as last year’s quote from the AA, things have, perhaps, not changed to the extent the car insurance industry would like us to believe.”
We contacted the AA and its spokesman, Conor Faughnan, sent us the following response. “You will often hear the AA advise consumers to shop around and it is true. Whether it’s broadband, credit cards, gym membership or whatever, a lot of companies will have incentives or discounts for new business. The AA sometimes does as well and this is very common in insurance. There are also things like multi-product discounts and incentives of that sort. Having said that, the price difference experienced by the customer here does seem very large, which is surprising and something we will have to investigate. The AA is an intermediary rather than an insurer; it does large deals with its panel of three underwriters for blocks of business, which it can then offer its customers. That is not quite the same as setting its own prices and it can sometimes lead to anomalies. Even so, this is an odd one for us to check out, and we can only say that if we don’t earn this customer’s business then we don’t deserve to have it.”
NOTHING FISHY IN THIS SHOP'S REFUSAL TO GIVE A REFUND
A reader by called Barbara bought a fish tank from a pet shop last Monday (in her mail she does not identify the shop or the locality). "When I got home I realised that it was not going to be suitable around my children. I contacted the shop, and they are telling me that can't refund me as there is no fault with it."
She says the shop’s website states that there is a 28-day refund and return policy and “it doesn’t mention anything about just being for a defect. Do I have a case here? I paid €420 for this?”
Probably not. Retailers are not obliged to give customers refunds simply because they change their mind. In fact, they are not obliged to give a refund if a product is faulty either. Under the law if a product is defective, a retailer is obliged to give a refund, a repair or a replacement – and the retailer gets to choose which. The bottom line is that retailers have rights as well as consumers. They sold the product in good faith and it is fit for purpose.
