I hate the insurance industry with a passion, for insurance firms and agents are, without argument, in league with the devil.
They profit from spreading fear and anxiety amongst us, presenting the worst case scenario for every aspect of our lives, in the hope that we will delve into our pockets for a little peace of mind. Our health, our loved ones, our property and our safety are all targets of these pedlars of doom. Even in death it seems – we should be worrying about whether we had been paying the correct premiums on the right death policy.
“You know whenever you hear an ambulance siren – there’s a person inside who doesn’t want to be there?” – upbeat quote from mortgage broker at John Charcol.
While I can accept that it is a necessary evil for certain aspects of life, those who actually benefit from it’s existence are rarely those for whom it is supposed to protect. In all the years I have paid premiums for this that and the other, I have never once made a claim. This means that every penny I’ve spent on insurance throughout my life has equalled 100% profit for the insurance firm. Thankfully few things require insurance by law.
When we rented our first apartment in France it came as bit of a surprise that we were required to have household insurance (assurance d’habitation), regardless of whether we wanted it or not; and before we could even sign our rental agreement we were presented with a policy that the estate agent’s “friend” had drawn up – that we had little choice but to sign.
In terms of cost, it didn’t seem to be a great deal, but then we weren’t aware at the time of how the insurance firm, Axa, would progressively increase our premiums year-on-year at an inflation-busting rate, so that five years later our premiums would have almost doubled.
The contracts drawn up by insurance firms in France use an ‘indexing’ system to ensure they don’t lose out year to year against a rising cost in goods, services, inflation etc… but of course this is not how it is presented. The sell is that YOU don’t lose out should the cost of replacing your goods have risen since you took out the policy, but of course in reality the cost of replacing most things goes down over the years, meaning the indexing system is just a neat way of increasing profits, but it’s all entirely above board in the eyes of the law.
The biggest problem however is getting out of an insurance contract, as the contract is written in such a way that your rights are severely limited when it comes to termination. To terminate a contract you usually have to send notification to the incumbent at least 2 months before the renewal date and this must be done so in writing and sent by recorded delivery. Failure to meet all of these requirements will result in a letter from the incumbent along the lines of:
“Ya boo sucks! Though shit! We’re taking your money anyway”.
I learned all this to my consternation just before Christmas when I discovered I could get the same household insurance cover for less than half the amount I was then paying. However I also learnt that I had the right to contest the annual increase, which as it happens had been rather large due to the insurance agent for Axa ‘accidentally’ stealing 600 € from me the year before.
It is likely if not certain then, that if you live in France, you are paying too much for your “assurance d’hab” (if you’re unsure – just go online to check out the competition). So you should try and make a point of cancelling your policy every other year to ensure you don’t get ripped-off by this indexing system.
For more information on your rights as a consumer see the DGCCRF website.