Car Insurance Premium Rises 21% for Same Level of Cover

Hi Guys

Any idea why car insurance has increased so much? Last year my car (Toyota Aurion 2008) was insured for $7900 and I paid $525 at AAMI for comprehensive cover ($550 excess). I got a renewal letter saying it's now $679, but they have increased insured value to $8700.
However, if I pretend to be a new customer and dial the agreed value back to $7900, this year's premium is still $634 - $110 more than last year. I have not had any accidents, fraud, jail time etc.

At RAC, for $7900 cover and $550 excess it is $640. Now it's not that this is unaffordable, but why on earth am I paying 21% more for the same insurance compared to last year? Is anyone else finding the same?

Comments

  • Yep I had the same issue with AAMI. Called up and the reason was that they gave me free road side insurance in the first year (and was bundled into the premium) and one other extra (think it was hire car). After reducing that I got to close to last year's amount.

    • Just looked, there is nothing extra added. Windscreen/hire car/roadside assist were extra options that I had not added.

  • -1

    Have you considered TTP insurance instead of comprehensive?
    https://www.aami.com.au/car-insurance/third-party-property.h...

    • +4

      Yes, thanks. Looked into it a while ago but if someone hits you and you're not at fault it sounds like a pain/impossible to chase it down, whereas with comprehensive the insurer does all the chasing.

      • Also to add to this, if your car is written off due to the fault of the other party, the other parties' comprehensive insurer may play the blame game; try to wriggle and may not want to pay you. You have nothing to fall back on apart from a civil claim

        • +1

          it's not about the other party insurer that you need to worry about, because that one is easy to deal with once you mention ombudsman. The issue is to get the other party to pass it on their insurer. Getting a civil claim in such case is tough job if they want to play hard ball.

          • @lgacb08: That's a very valid point. Therefore full comp is king

  • +3

    Welcome to the wonderful world of insurance. Your making a mistake and assuming that the value of the car is one of the most significant factors affecting price (hint - it isnt). You will find frequently that premiums for new vehicles are cheaper than existing cars even though the the new cars cost more.

    Insurance premiums change based on Age, Sex, Driving History, Insurance History, Vehicle type, Vehicle Value, Ease of Repair, How frequently those cars are in accidents, Your suburb etc. Majority of accidents happen within 3-5km of where you live, so if you live near a major shopping centre that has alot of little accident claims expect the overall price of insurance for the suburb to go up.

    It goes further than that though, Insurance companies usually value new customers more than existing customers - hence when if you get your annual premium renewal if you put the same information into the website its usually cheaper. The retention rates of customers in your postcode will affect your premium… if the average joe in you postcode is renewing without shopping around they will push the price of the suburb up because its about making money after all.

    If the company has had a good or bad year it will affect prices. For a while a major insurer was trying to attract customers so they were discounting new business, then they had a pivot shift and ramped up the renewal prices once they had adequate market share.

    Bottom line - if you dont shop around every year for the cheapest premium your a chump. Also yes, prices generally head up year on year

    • +1

      As the OP's thread is focusing on AAMI, please do me a favour and get a quote for your car at your address and then get another quote for your car at your neighbour's address with the same credentials. It'll be different, and may be the difference factoring over $100s. … for only 3 meters away. Please do it and get back to me and if it is different, then all of your statements are incorrect apart from new customers

      • QTE447863686 $775.43 11 Hayward Parade, Coogee
        QTE447863923 $775.43 13 Hayward Parade, Coogee
        DOB 01/01/1980
        Postcode 6166

        • Thanks. I'll try as well and see if they have fixed thier random quote generator. Edit. What make/model/year car?

        • They have must have narrowed their price differences as prices will fluctuate just over a neighbouring property.
          Looks like that have closed that slight gap, possibly over people complaining IMO

          Car: 2015 Ford Falcon XR6 sedan auto. Garaged same address, and weekend, driven 20K Km per year/5+ days per week.
          Male driver, clear history, no finance
          DOB 01/01/1980
          Postcode 6166

          ~ 100m radius of addresses

          1 - 11 Hayward Pde, Coogee = $751.98
          2 - 25 Anita Crt, Coogee = $735.94
          3 - 3 Lupin Way, Coogee = $771.18

          Quote number is the same. Just go back after the quote and place the new address and random quote generator activates the new quote

          Anita Crt is geographically not even 100 meters away from Lupin Way and you pay ~$40 more.
          Not the same quote as many others are with suburb therefore still address specific as I have stated

  • Try Bingle

  • Did you change postcode? This can have a major impact on the premium.

    When I moved from the shire to the southern highlands, both insurance and CTP dropped by $150

    • AAMI is address specific and not suburb. So basically your neighbour that is 3 meters away can either pay more or less having the same car as you by being insured with AAMI LOL

  • Virgin Money has a $150 gift card with theirs, you can also get 5000 points (about $22) sign up bonus here in the referral links section

  • Try alliance. Suncorp put my house insurance from 2k to 4.5k this year, same cover with them was like 1.3k… I paid for the year thanks 😋

  • I am of the opinion that drivers are becoming more noncompliant of the road rules, take more risks, and generally less good natured on the road, compared with some years ago. Extra vehicles on the road and declining standards of ethics and common sense in areas like large car parks all add to higher risk. There is a higher probability of being in an incident, despite extra safety features in motor vehicles.
    This whole scenario is reflected in higher insurance premiums.

  • +3

    Some good replies on Whirlpool for you Captain Planet roddo

    https://whrl.pl/RgjYp9

  • With all the lock downs and people driving a lot less you would think that premiums would have reduced? But no…

    • +1

      100% with fewer accidents & claims…..

    • AAMI are also kms specific, so if you are with them, call them and drop the kms per year to 5K Kms (bare minimum due to lockdown) and the premium will drop. Try to call your insurance as they will not call you to discount :P

  • My car insurance renewal just came
    Reduction in cost of 11%
    Agreed Value Unchanged

  • umm not to be obvious but its a few factors

    companies will take advantage of people's laziness. my premiums have gone up, something like $640 -> $670

    howver the way i look at it, how much of my time is it worth to find someone cheaper… is it worth $30??? not really

    plus you'll find that car insurance is just one product an company may offer

    if a company took it in the butt due to bushfires burning down house then they may seek to recover monies from car insurance to cover that

    nothing personal just business, also i worked in insurance before but my experience with some of the people there tells me they hire some of the smartest people out there to work out just what is best for them to take money from one arm to pad out another section like as i describe, its all maths, acturaies etc.

    obviously they may keep upping insurance premiums until i leave but theyve already screwed a few years of me for zero payback so its win win win to them

  • Thanks for the replies
    So in summary, it's multi factorial. I haven't moved house.
    The rates were similar with rac. Maybe last year was an anomaly having paid just over $500. I'll call them, but last time I did it was still cheaper to sign up for a new policy than what was offered over the phone.

  • I've had similar experience with RACV, and now AAMI. One of the AAMI is for renewal in 3 weeks and premium increased from $730 to $950 for the same cover on AAMI.

    It's so annoying… Every 12 months I have to compare the cover, change, then come back after 12 months again…

  • Shop around. It's the usual lazy tax that gets charged to loyal/lazy customers.