Car insurance providers urged to clarify direct debit fees

Thu, 19 Aug 2010

Car insurance providers should clarify the direct debit fees they charge customers, it has been argued.

Defaqto, the independent financial research company, has published its comprehensive annual report on the car insurance industry, which addresses the challenges currently facing the sector.

The company observes that many Britons choose to pay for their car insurance by monthly installments, particularly if the premium is high.

At present, the average fee that providers charge for this is between eight per cent and 11 per cent of the gross premium.

For eight per cent of the total policies on the market, however, the fee charged by providers was not stated.

Mike Powell, author of the report and Defaqto's insight analyst for general insurance, commented: "What should be a concern for the industry is the number of policies where the level of fees to be charged is unclear to the consumer.

"Professional researchers sometimes struggle to find this information, so what chance does an uninitiated customer stand?"

Earlier this week, Santander Insurance UK announced that it shall be giving away the choice of a TomTom Start sat nav or £50 cash back to anyone who takes out its new car insurance policy before the end of the year over the telephone.
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