Which? highlights unnecessary insurance costs
According to two separate reports by consumer champion Which?, insurance customers are facing unnecessary costs.
Which? has found that 10 out of the 12 largest water companies are promoting pipe insurance from third parties such as Homeserve.
This insurance costs consumers more than £100m in total and in many cases it is unnecessary Which? claims.
Water companies provide their own repair schemes free-of-charge to customers, potentially overlapping with the services offered at a price by companies such as Homeserve.
Some water supply problems could also be covered under home insurance policies.
Nine out of the 12 largest water companies promote Homeserve’s policy through direct mail promotions to their customers, sometimes on their own headed notepaper.
Which? also highlighted a problem with the advice published on water companies’ websites.
Many sites advise customers to first call a plumber if they find a leak.
This could invalidate a claim under a home insurance policy which may require the insurance company to be notified before a repair is carried out.
However Homeserve said that the Which? report was misleading as water companies are not obliged to offer a repairs service and may not be able to respond quickly.
In a second report, Which? highlighted that insurers may be charging hidden fees for insurance policy changes and renewals.
AXA and Swiftcover charge customers £30 to update personal details such as address and surname, while Hastings charges £35 to update this information.
Charges are also made by some companies for policy renewals and cancellation.
Which? is calling for insurance companies to be more transparent about fees, which are often hidden in the small print of terms and conditions.
Peter Vicary-Smith of Which?, said: “These charges should reflect the real cost to the company and not a way of making easy money from consumers who are already struggling with high and rising insurance premiums.”