Why your insurance is getting more expensive

Angus Kidman 22 August 2016

Insurance_Shutterstock

When insurers can't make a profit, putting up prices is always the first tactic they use.

Insurance giant QBE released its annual results last year. It made an interim profit of $265 million, which is hardly chicken feed. However, it had a combined operating ratio of 99.0%, which isn't such good news. If the ratio goes above 100%, the business isn't breaking even. So what is QBE going to do? Put its prices up.

That's not just guesswork on my part. QBE says so quite explicitly in its results announcement:

We are responding decisively with price increases, revised terms and conditions and other portfolio adjustments.

So you can look forward to higher prices, more nit-picking over claims and more exclusions in any insurance policy you take out. While QBE has been unusually up-front about its plans, the pressures it faces impact the entire industry. That means that more than ever, if you want to get the best deal for your insurance, you need to shop around and compare brands and deals carefully.

This isn't a new development. For insurance, the devil is always in the details. If you're looking at health insurance, you need to pay careful attention to where the gaps are going to be. If you're after travel insurance, you need to make sure that you include all the activities you might take part in, but don't pay for options that you aren't going to use. If you're examining car insurance, you need to consider who will regularly drive your vehicle.

QBE's key responsibility is to its shareholders, which is why it makes its plans so clear. Your key responsibility is to yourself. Don't just settle for the first insurance deal you find, or mindlessly renew your existing deal. Even in a tough market, you can still save by shopping around.

Angus Kidman's Findings column looks at new developments and research that help you save money, make wise decisions and enjoy your life more. It appears Monday through Friday on finder.com.au.

Picture: PomInOz / Shutterstock.com

More great ideas from finder.com.au

Get a life insurance quote
Get a life insurance quote

Find out what it costs to protect yourself and your family

More info...
Refinancing home loans
Refinancing home loans

Choose from offers with rates as low as 3.39% p.a.

More info...
Google Pixel
Google Pixel

Compare plans for Google's flagship Android phone

More info...
Christmas ideas
Christmas ideas

Visit our Christmas homepage for gift ideas, markets, travel & deals

More info...

Ask a Question

You are about to post a question on finder.com.au

  • Do not enter personal information (eg. surname, phone number, bank details) as your question will be made public
  • finder.com.au is a financial comparison and information service, not a bank or product provider
  • We cannot provide you with personal advice or recommendations
  • Your answer might already be waiting – check previous questions below to see if yours has already been asked

Disclaimer: At finder.com.au we provide factual information and general advice. Before you make any decision about a product read the Product Disclosure Statement and consider your own circumstances to decide whether it is appropriate for you.
Rates and fees mentioned in comments are correct at the time of publication.
By submitting this question you agree to the finder.com.au privacy policy, receive follow up emails related to finder.com.au and to create a user account where further replies to your questions will be sent.

Ask a question
feedback