Below is a press release from AA Insurance.
Like-for-like premium comparisons coming for AA Insurance customers
AA Insurance customers will be able to see what they paid for last year’s cover on premium renewal notices issued from early 2021, making it far easier to compare premiums from year to year.
“Despite being introduced into the UK market several years ago, and Australia in 2018, like-for-like comparison of premiums, or annualised premiums, haven’t yet been made available by the New Zealand general insurance industry,” says Chris Curtin, AA Insurance CEO. “We really wanted to be transparent and do the right thing by our customers – and as quickly as possible – especially as we know that juggling finances has been particularly difficult for some of our customers during Covid-19.
“Although we were ready to launch this initiative in March,” he says, “the situation with Covid-19 meant we had to reprioritise activities to meet our customers’ immediate needs. Currently we have a freeze on premium increases in place so we will be holding off until early next year when the timing is right and there is a clear space between the premium freeze and this change.
“Waiting for a proposed reform regarding premiums to be passed by law was not an option for us – we do what’s best for our customers because we want to, not because we must,” he says.
“We listened to what our customers were saying about having clarity around premiums and, by providing useful information like what you paid last year and the percentage it has changed, customers will now be able to make an informed decision about renewing their cover. We encourage them to use this information to shop around for the right insurance for their situation and consider price as only one factor in their decision.
“This initiative is part of our philosophy of looking after our customers and doing the right thing,” Chris continues. “It’s about treating our customers with fairness and operating with transparency.”
The premium notices will incorporate the changes that have been made to a customer’s policy through the year, so they receive an accurate account of how much their premium would have been the previous year, based on their current renewal details. For example, if they have changed cars within the last 12 months the notice will update last year’s premium to show what they would have paid, alongside what they’ll pay this year, so they are able to compare like-for-like premiums. If customers have made no changes throughout the year, they will see what they paid for last year’s cover.
“We don’t expect our customers to search through a year’s worth of paperwork to find last year’s insurance premium to make the right financial decision about renewing their insurance,” says Chris. “For us, it’s about helping our customers the best way we can and being clear about pricing is a simple way we can do that.”