The single most reliable way to lose money in a British household is to do nothing. Insurance renews at a higher price. An energy fixed rate ends and drops you onto the standard tariff. A broadband contract finishes and the bill quietly increases. None of it requires a mistake. It just requires inattention.
The regulator has taken some of the sting out of insurance pricing, since firms can no longer charge existing customers more than a new customer for the equivalent policy. That helps, and it does not remove the gap between the renewal quote and the best price on the market.
List everything that renews
The system is only as good as the list, and the list is longer than people expect.
- Car insurance, plus MOT and vehicle tax.
- Buildings and contents insurance.
- Life insurance and any critical illness or income protection.
- Pet insurance, which has some of the steepest renewal increases of any product.
- Travel insurance, if it is annual.
- Energy, if you are on a fixed tariff, with the end date.
- Broadband and mobile contracts, with the minimum term end dates.
- Breakdown cover.
- Boiler cover or a service plan.
- The mortgage deal end date, which is the largest number on this list by a wide margin.
- Passports and driving licences.
- Professional memberships and subscriptions.
- TV Licence.
For each one, record the provider, the policy or account number, what you currently pay and the date it renews or ends.
Work backwards from the date
The reminder should not land on the renewal date, because by then you are choosing between a rushed decision and letting it roll.
Insurance is best shopped around three to four weeks ahead. Pricing analysis has consistently found quotes are cheapest around three weeks before the start date and rise steeply in the final few days.
Energy and broadband deserve a month, so you can switch cleanly as the term ends.
A mortgage deserves six months. Most lenders let you secure a new rate three to six months ahead, and you can usually swap to a better one if rates fall before completion. This single reminder is worth more than everything else on the list combined.
What to actually do when the reminder fires
Ten minutes, three steps.
Get a comparison quote. Then, if you would rather stay, ring your existing provider and tell them what you have been quoted. Retention teams have discretion that the renewal letter does not.
Check the cover has not quietly changed. Insurers sometimes hold the price by raising the excess or dropping a benefit, so compare like with like rather than headline figures.
And if you switch, make sure the old policy actually cancels. Overlapping cover is common and pointless.
Two things worth checking once
Duplication is rife. Breakdown cover and travel insurance are frequently included with a packaged bank account, a credit card or a car warranty, and thousands of households pay separately for both.
And auto-renewal on insurance can generally be switched off. Turning it off forces an active decision each year, which is exactly what you want.
Where it should live
A spreadsheet works. A wall calendar works. What matters is that it is in one place, it is current and someone other than you could read it.
That last point is easy to overlook. When someone becomes ill or dies, the renewals are what keep the household functioning, and a family who cannot find the insurance details is a family with an uninsured house.
Where FamilySafe fits
FamilySafe holds every renewal with its date, provider and policy number, prompts you before each one and keeps the documents attached. Your household can see it too, so the system does not depend on one person remembering. Ten minutes a few times a year, and the loyalty penalty stops applying to you.
