Money Talks

How a new type of insurance could change the way young people drive

Car insurance isn’t usually something to get emotional about but last week, at a press launch of a new type of car insurance, I felt myself welling up.

A new type of insurance being promoted by The Cooperative, and to showcase it the Insurer invited along road safety charity Brake and one of its campaigners, Nick Bennett.

Normally I can see through a PR stunt and would brush it off as a bit of shameless self-promotion on the insurer’s part, but this time the message was hard hitting.

Nick is 27 and has been in a wheelchair since he was 19 because, like many young drivers, he was full of bravado and as a result, crashed head first into a 3 tonne lorry.

One of the biggest car insurance debates of late has focused on the need to better train young drivers, particularly males, who make up a significant proportion of the UK’s road deaths and serious injuries, and pay huge car insurance premiums as a result.

Despite his disability, which includes speech problems, Nick spoke to us and said: “I was on my way to work and it was early in the morning.

“I came up behind two slow vehicles in front so I overtook them. I woke up after spending 3 and a half weeks in a slow recovery coma. Somebody told me I’d crashed my beloved Corsa.

“My message is, please please, please, don’t think you can drive recklessly without suffering consequences.”

Nick then went on to speak about the new Smartbox technology from The Cooperative – the real reason all us journalists we’re asked to convene at the Goodwood racetrack. It’s a new type of insurance, which rewards good drivers with cheaper car insurance.

The Smartbox works by monitoring how you drive using G force and GPS technology. So if you’re the sort of driver who accelerates aggressively, brakes harshly or regularly exceeds the speed limit then this box will pick it up, and will penalise you for it.

Nick said he’d have thought twice about over-taking if he knew it would cost him more money.

It’s a fact; young boys have more car accidents. When you read about a fatal car crash involving teenagers it’s usually the lads because they’re risk judgment is less developed.

Just last week I saw a group of lads in battered old Corsa necking cans of Carling. The driver then mounted the pavement to avoid a traffic queue and nearly took out a cyclist before diving down a side-road.

Perhaps you are a young driver, or maybe you’re a parent of a young driver. If so, then no doubt you’re staggered by the cost of insuring even the most basic, low value, car.

But more importantly, as a parent, you probably worry that inexperience and a tendency to show off behind the wheel will end up with a knock on the door from a pair of police officers.

So not only could this new technology ease the burden of paying these sky-high premiums, it could go some way to knocking some sense into would-be reckless drivers. I’m not here to sell the product, just to inform and offer opinion- you make up your own mind and if you want to know more, see my article ‘how a black box means cheaper insurance for young drivers.’

Let’s hope plenty of young drivers take it up and other insurers adopt similar policies to get this rolled out across the board.

The hunt for cheaper energy bills - my comparison nightmare

We’re constantly being told to switch to save on our gas and electricity bills. And after the main energy providers all recently whacked their prices up, this message has never been stronger.

So I decided to bite the bullet and sort my household bills out. I’ve just moved into a new flat and wanted to start off well by not paying over the odds for gas and electricity.

I contacted the Big Six; British Gas, E.ON, EDF, npower and Scottish Power. My current provider is Southern Electric and I’d already established that it wasn’t my cheapest option.

I know online is usually the easiest search tool but I called the sales hotline of each provider to see how they fared on customer service.

I was armed with very little information. I knew my new postcode and my current supplier. I also knew I wanted to get a quote for annual and monthly spend from all of the providers and I needed to know if their best deal was online and whether it was paperless.

Here’s how I got on:

npower

My first call was to npower. The sales advisor was very chirpy and helpful. So helpful in fact that, when I explained that I had no idea what my usage was or what my annual spend is, he gave me the government average in units for both gas and electricity for two people living in a one bed flat. He then explained that my best option for getting a fair comparison was to quote those figures to the other providers. No hard sell, just useful information.

He said their best deal was an online only tariff and said my best bet was to sign up via their website.

Was the online tariff their best deal? Yes  

Paperless billing? Yes

British Gas

I made the call at around 3pm, so not exactly peak time, yet had to hold for several minutes. The sales advisor was very friendly, albeit a bit on the pushy side.

After taking my postcode, she told me that British Gas was the cheapest supplier in my area, even quoting the percentages by which their rate was better.

Annoyingly though every time I asked a question, or she needed to find something out, I was put on hold. Six times in total over a 15 minute call. I was quoted an annual spend of £780. This is before any of its discounts had been applied. I was then bombarded with percentage discounts for various tariffs; six per cent for their web tariff, 4 per cent for online account, yet she couldn’t tell me what the annual spend was once everything was applied.

And it later transpired after I did my sums that British Gas wasn’t the cheapest at all. In fact, it was the most expensive based on the average usage I gave all the suppliers.

I was almost tempted by the £75 credit the sales advisor was offering. I asked if that meant that the first month or two were technically free. This is when I was told that the credit didn’t come through until the end of the 12 month contract. The sales advisor was polite but pushy and I had to insist that I wasn’t interested in signing up there and then several times.

Was the online tariff their best deal? Yes  

Paperless billing? Yes

EDF

The call to EDF Energy was pretty swift. I explained what I was after, gave the sales advisor the usage figures npower had given me and was given the yearly spend average of £728.38. The only issue was, at the end of the call, I was told that the tariff I’d been given information about was due to end at 8pm that evening and would be replaced by a slightly more expensive offer.

But there was no sales pressure, just a quick rundown of the basic information.

Was the online tariff their best deal? Yes  

Paperless billing? Yes

EON

Despite EON’s call centre having a special ‘home move’ area for new sales enquiries the sales advisor wasn’t very helpful. The conversation fell silent after a few seconds of searching for my address with no luck. When it started to get awkward, I suggested running an average quote, based on some average consumption figures, and the sales rep agreed. It came back at £568 per year, which was far cheaper than the other providers. Usually that would be a good thing but I was left so unconvinced by the advisor’s expertise that I wrote it off as being too cheap, and therefore probably inaccurate.

Was the online tariff their best deal? Yes  

Paperless billing? Yes

Scottish Power

Last but not least I called Scottish Power. The call was by far the most helpful, because the sales advisor was the only one to tell me how much its energy cost per kilowatt and per unit. Which is after all, what determines how much you’ll pay. None of the others gave me this information and it wasn’t until Scottish Power did that it dawned on me that it might be useful to know – remember I came to this with no idea what I was doing. The annual average came out at £739.

Was the online tariff their best deal? Yes  

Paperless billing? Yes

How much did I save?

The big question hanging over all of this, and what I really wanted every provider to tell me was ‘how much will signing up with you actually cost me?’

But it seems that unless you want to fix or cap your energy usage there’s no real way of knowing how much will disappear from your bank each month. And unless providers tell you what they charge for gas and electricity it’s difficult to make a fair comparison.

In the end, I shopped around online and switched to Scottish Power. But I may well be switching again in a few months time if the bills don’t fall within their estimate.