Getting a better deal is often as simple as asking. Source: Getty Images

If you own general insurance, such as for your home, contents or car, chances are you buy 12 months worth of cover at a time. At the end of the year, your insurer will write you a letter asking if you’d like to sign up for another year, quoting a price if you do.

Your new premium will most likely be significantly higher — but no insurer will tell you how much you paid last year. And who has time to go back and check bank statements or renewal notices from 12 months ago?

The Checkout last year dubbed it the Lazy Tax — the cost of not bothering to check, compare and shop around. Many insurers offer discounts for new customers, but few actually reward loyalty, despite what their marketing says.

A simple call to your insurer to ask why your premium has increased, and whether they can give you a discount, will often do the trick. If not, threaten to take your business elsewhere.

Kevin Newman from Albion in Melbourne’s west nearly allowed his car insurance to renew as per usual but thought to check his bank statement to see what his premium was previously.

“I was surprised to see that my premium had gone up, again, without any mention from my insurance company despite years of loyalty,” he said. “It would’ve been much easier to compare if my insurance company listed last year’s price.”

He said after switching to a competitor he is now paying more than $300 less this year, with better benefits.

New research commissioned by the Consumer Action Law Centre in Melbourne has found the overwhelming majority of insurance holders want to see clearer information about their premiums displayed on renewal notices.

The CALC is calling for all general insurers to include on their renewal letters, in clear terms: the price of the insurance if the customer renews; the price paid last year; and the reason for any change.

Eighty-six per cent of consumers surveyed said they would find it ‘useful’ or ‘very useful’ to have this information. Fifty-seven per cent said it would be ‘very useful’.

“It’s not to say you can’t look at your bank statement from 12 months ago and check, but the fact is we know people don’t do that — and insurers know people don’t do that,” said David Leermakers, senior policy officer at the CALC.

“They send out plenty of messages saying if you’re loyal to us we’ll look after you, but we know the prices do go up. If insurers know you’re more likely to say ‘I’m too busy to do this’ and just accept, there’s not much deterring them from upping the price more than they need to.”

He said customers could quite often get a better deal just by asking. “There’s no harm in going back to your insurer and asking them to explain the rise, and asking for a better deal,” he said.

But he said if shopping around, consumers should be careful not to move onto a cheaper policy with less cover. “Consumers have to start thinking much more about insurance and not just buying on price.”

He said forcing insurers to display the extra info was a simple, sensible measure that would increase accountability and help consumers. “For one thing, this would prompt people to shop around if there has been a price rise, while at the same time ensuring a bit of control on insurers.”

A spokeswoman for the Insurance Council of Australia said: “The Insurance Council cannot comment on this report. However it notes that consumers already have access to how much they previously paid through prior renewal notices and bank records. This information is also available by contacting their insurer.”

UK insurers have already acknowledged that this is a sensible idea.

The Association of British Insurers has asked the UK’s financial services regulator, the Financial Conduct Authority, to bring in new minimum standards requiring insurers to include last year’s price alongside renewal quotes.

Global insurance giant AXA, which has 10 million customers in the UK, has already committed to include last year’s premium in insurance renewal quotes.

frank.chung@news.com.au