Recent letters regarding motor insurance premiums raise an issue that strikes at the very heart of our industry – the ability and freedom to underwrite.

The fact that some insurers “cherry-pick” more than others is all part of a very competitive market, which goes out of its way to reward the good, careful driver, and make sure that he does not subsidise the others. This was one of the reasons why the Knock for Knock agreement was allowed to lapse several years ago. Is Oscar Hasdell (Insurance Times, February 8) advocating a return to these days as well?

The issue of “free insurance” schemes is another topic, and I think that there are many underwriters in the market regretting the day they entered into such an arrangement. Their performance is hardly a good reason to encourage insurers to “throw away the rulebook”.

Fanella Radford (Insurance Times, March 1) talks of a “double jeopardy” situation where a convicted driver is punished twice, once by the fine, again by the premium load, and thinks it unfair. Working on the principle that each should contribute to the pool according to the risk they bring, how can anyone disagree with this being taken into account in the premium?

Drivers who, by picking up convictions, show a disregard for the law, and motorists who by having accidents indicate a lower driving skill, should put more in than those with fewer or no accidents or convictions.

We cannot escape from basic rating factors. We owe it to all our customers.

Lastly, can I ask? What has happened to the old Declined Cases Agreement? As far as I am aware it is still there, even if the AOA isn't, but the fact that it is rarely mentioned must mean that there is a market for most risks if you look hard enough. Or is that just wishful thinking on my part?
Roy Rodger FCII
Motor Insurance Consultancy and Training

Just bin it
Norwich Union (NU) has produced an excellent booklet “How to avoid hiring the bad guys”.

It has invited brokers and intermediaries to order a supply for sending out to clients and even to use as a marketing tool.

I thought this was a most generous offer from a company repeatedly being criticised by the intermediary channel. However, my view quickly changed when I reached the inside back cover where there is the heading “Useful numbers and websites”.

Lo and behold, after various trade association telephone numbers is the website Perhaps NU can explain the benefit of the website address in the context of avoiding rogue companies.

Anyone visiting the site is going to find offers for obtaining quotations for car and household business direct.

Therefore I would strongly urge all brokers and intermediaries to consign this seemingly generous offer to the WPB unless you wish your clients to seek alternative quotations from NU Direct.
Name and address withheld

No, no, no, no!
Having read many articles regarding the inefficiencies of today's insurance industry, I felt that the following may be of interest.

My office has held a risk for many years in the name of Phillipps – yes there are two “p”s.

This contract commenced with the Orion and is now under the control of Axa. Each renewal has been accurately prepared until Axa came on the scene, when they decided that the name should only have one “p” at the end.

Papers were returned for correction on June 12, 2000, and an amendment was completed with the extra “p” included. An additional premium of £83.56 was charged.

Having raised the matter with staff members and Richard Pratt, the complaints manager, a further adjustment was made which now reduced the original premium from £404.99 to £391.12 – the client having already paid. On July 13, 2000, a further endorsement appeared showing an additional premium of £13.87 (£391.12 + £13.87 = £404.99). Hooray.

However, on July 18, 2000, another endorsement arrived producing an additional premium of £13. The accounts department has not known whether it was coming or going, and compensation for this and other errors was requested without success.

On another matter, today I learnt that to change a bank account number on a direct debit with a full cycle EDI policy with Zurich causes the outright cancellation of the contract without any means of reinstatement. This forces the issue of a new contract at increased rates for a new 12-month period – fortunately the company has offered an alternative, to the satisfaction of all concerned.
Nigel Guest
J B Insurance Brokers.
Cheam Village

Conflict is nothing new
We are constantly receiving circulars complaining that some wicked insurers (no doubt aided and abetted by the General Insurance Standards Council), such as Groupama for example, may be contravening the Competition Act 1998 by insisting that brokers holding an agency with them must henceforth be members of the GISC. This is clearly quite outrageous.

Kinder companies, such as Broker Direct on the other hand, only deal with brokers who are members of the IIB. Well, how very reasonable.

The words “competition” and “abuse” evidently have different meanings depending on which hat one is wearing.

On a serious note, there has rarely been a time in the 30-odd year period that I have been in broking when conflict in some form or another has not existed – either between our regulatory bodies, or between rival associations/ corporations/ institutes of insurance brokers. A solution could have been for the Chartered Insurance Institute to license everyone working in insurance. Examination qualifications could have been the steps to more responsible positions, misconduct could have meant loss of licence and goodbye to an insurance career. Is it too late to try?
John Miles
Speed & Company

They haven't got a clue
As Axa hunts for a replacement for Mark Wood, I wonder whether it realises how productive its organisation is?

We sent a year end declaration in for a liability policy, along with new estimates, to enable it to calculate this year's renewal premium. Last year's was £281 and approximately six weeks after renewal we received renewal papers advising a premium of £945.

A week later we received the year end adjustment – they only wanted an additional premium of £19,717. Now, it either has some very loyal underwriters who wish to do all they can to help their employer pay for Mark Wood's severance pay or, as we suspect, have no clue as to what they are doing. Upon referring the matter to them, they did not seem to know why it was issued. We hope the item stays on our account for as long as possible. They may think we have more business with them than we actually have, and it may even improve our standing with them.
Alan Hancock
Neil Redman Insurance

You cannot be serious
It is not only giants such as Groupama who are issuing inappropriate circulars.

We have today received a letter from Iceni Motor Facilities informing us that if we do not confirm our membership of the GISC to them by the April 1 2001, they will assume that we are not members and will therefore deal direct with the client.

Does anyone believe this action is justified?
GB Jones
Vale Insurance Brokers