Investigation finds City Insurance charged high APR on car insurance policies
- Reports
- 2
- Developments
- 2
- Repetition
- 0%
New informationRepeats or wire copies
What happened
A mystery shopping investigation involving 30 car insurance providers and brokers found that some companies charge high interest rates on monthly policies, a practice known as premium finance. City Insurance was found to be charging 53% APR, although the provider later stated it was reducing its rate to approximately 36%. The investigation also found that some providers offered 0% APR to customers using the same profile.
From aol.co.uk, insuranceage.co.uk
Why it matters
The practice of paying for car insurance monthly through credit agreements means customers pay more over the long term compared to paying upfront. Consumer groups have called for a ban on brokers charging high annual percentage rates on these policies.
ASIC is investigating insurance industry practices regarding premium hikes.
From aol.co.uk, insuranceage.co.uk
Who's involved
- City InsuranceCharged high Annual Percentage Rates on monthly car insurance policies
Who could feel it
Possible knock-on effectsThese are possibilities Brind reasoned out, not predictions, and not advice. Most are not stated in any report.
- City InsuranceSpeculative
City Insurance might face regulatory pressure that could impact its profitability
How it developed
Newest first. Tap a step to see who reported it.Investigation reveals City Insurance charged high APR, contrasting with Marshmallow's 0% APR offers.1 source
City Insurance charged 53% APR, leading to calls for a ban on high rates.1 source