Why do new insurance customers get good discounts when loyal customers don't?

I have been insured with Aviva for a number of years and both my wife and I have six years' protected NCD. Despite having no claims in recent years, the renewal premium has risen to £574 which is an increase of over 14 per cent. The same company quotes online a premium of £426 for identical cover, but this is available only to new customers, so it appears that loyalty is not being rewarded. Is this general practice in the insurance world?

Asked on 21 July 2012 by DR, via email

Answered by Honest John

Many readers have encountered this, and have gone back to their insurers and done a deal with them to get the insurance at the 'new customer' price. We live in an age of uncontrolled rip-off or barter.

Update: DR later wrote: I took your advice and, having searched another Aviva online site which came up with a premium of £395, went back to my renewal company who said they would match any price. So the bartering has saved me £176. Thanks.

Tags: insurance

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