Almost half (55%) of the 1,500 customers surveyed by Which? had to chase their insurer for a claim to be progressed and two-thirds (64%) said they were paying higher premiums on the policy’s renewal.
A tenth felt the price increase was significant, meaning many customers think they are getting a worse service while their premiums escalate.
Across the board, the average score customers gave their provider was 65%, while TSB scored the lowest out of the 20 firms with 59%.
None of the 20 brands achieved the Which? Recommended Provider Status, despite AXA meeting the minimum qualifying score of 70%. This was due to limitations on its standard policy coverage, the consumer champion noted.
Some of the issues that customers felt aggrieved by were the rising costs of the policies and the level of acceptance rates of claims, and there were also general complaints about the customer service they received.
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Meanwhile, the cost to cover your home skyrocketed by a fifth in the space of just 12 months, and those who pay monthly are hit harder than those who can afford the upfront option.
Following that disparity, the Financial Conduct Authority (FCA) has been urged to address the high-interest payments households face to split their premiums each month.
It has also become an issue in the motor insurance sector and led to a crackdown by the FCA, which launched in April 2024.
Matt Brewis, the head of insurance at the regulator, described the payment structure as a “tax on being poor”.
Since then, members of the Association of British Insurers (ABI) have agreed to the Premium Finance Principles, which look to provide customers with better transparency as to how much the premiums will cost.
However, as it stands, there are no plans for specific principles to be introduced to the home insurance sector.
Rocio Concha, Which?’s director of policy and advocacy, said: “Many customers who pay for home or car insurance monthly don’t do so out of choice, but a financial necessity. That these same customers can end up paying over the odds compared to those who pay for cover annually is blatantly unfair.
“This is not the first time Which? has sounded the alarm over eye-watering levels of interest, yet excessively high rates persist.”
Concha added: “Car and home insurance policies aren’t nice-to-haves, but essential for motorists and homeowners. It’s high time for the FCA to take meaningful action against firms that continue to charge high rates and end this injustice.”
