Why do car insurance companies operate dual pricing?

Why is it that car insurance companies operate dual pricing? Is this legal? I received my car insurance renewal papers today showing a quotation of £222.50. I looked on a comparison website and a like for like quotation was £194.06.

I contacted my insurer - who I've been with for years - and after ages on the telephone they matched the online figure. I find it appalling they charge loyal customers considerably more than new customers!

Asked on 3 March 2016 by Classical

Answered by Honest John

There used to be Insurance underwriters, Insurance companies and Insurance brokers. Over the past 10 years the difference between Insurance companies and Insurance brokers has become increasingly blurred to the extent that an 'Insurance company' acting as a broker may well be working on a 100% commission rate rather than the standard 10% broker commission. How much of that 100% they give to the customer varies.

Tags: insurance

Similar questions

What cars have the cheapest insurance for a young driver?

Which would be the best used car for under £2k for a young driver to insure? I've looked at some 1.0L engines but some are over £3k for insurance and some are under £2k. Does it not just go on the engine...

Is it possible to get repatriation cover while in Europe?

We are taking delivery of a brand new VW campervan and planning on taking it to Europe in September. The VW warranty provides breakdown cover in Europe for 3 years but I don't believe it extends to repatriation...

Can I choose where my car is repaired when I make a claim?

I damaged my 2018 Mercedes-Benz A-Class and unfortunately I had to initiate an insurance claim via my insurer. I was keen to get the car repaired at the local main dealer but my insurer said this would...