Woman’s car insurance premiums rise after she retires male co-driver
“I told him, ‘I don’t want a fit on my premium, I want you to look at the matrix you are using.’” Photo / 123rf.com
An Auckland woman was shocked to find that removing her former partner from her auto insurance policies had increased her total premiums by hundreds of dollars.
After calling Tower Insurance for an explanation, she says she was first told that a factor could be because women are considered to be at higher risk.
However, the insurer has now apologized for “incorrect information,” and says the removal of the male driver should in fact have reduced the annual cost of policies.
The woman, who asked not to be named, has two separate policies with Tower, covering one car each. She used the insurer’s website to remove her former partner from policies as a driver, and the combined cost of policies has increased by hundreds of dollars per year.
Her former partner had a restricted license when added as a named driver, and she receives a no-claim bonus on both vehicles, so the adjustment cannot be due to her own driving history. She updated her address separately, and that didn’t change the bonuses.
“The first person I spoke to [in customer service], he used words [to the effect] that it is calculated because women are considered to be at higher risk.
She asked to speak to someone higher up, who said her gender was not a reason for the recalculation, but could not provide an explanation. They promised to look into it.
“I said to him, ‘I don’t want my premium adjustment, I want you to look at the matrix you are using to make these decisions.'”
Asked about the case, Emily Davies, head of business affairs at Tower, told the Herald on Sunday that the online recalculation was a mistake.
“We have contacted our client and apologized for providing incorrect information about her policy change.”
Davies said the details of the policies could not be discussed for reasons of confidentiality. However, “while insurers use factors such as age, registration type, gender, and vehicle model to calculate an individual’s auto insurance premium, the change you described should have result in a slight reduction in the premium for the customer, not a significant increase. We are investigating how this error occurred. “
Insurers calculated premiums based on statistical differences that could be proven to change risk, she said.
“For example, our loss data shows that younger, male drivers are statistically more likely to be in an accident, which means their premiums may be higher than older drivers.