Massive increase in premium shocks Tower customer

Massive increase in premium shocks Tower customer | Insurance Business

Massive increase in premium shocks Tower customer

A Tower Insurance policyholder has made national headlines as she tries to figure out why the premium on her house insurance is increasing by $5,000 a year.

Ursula Egan, in a report from Radio New Zealand, said she was told that premiums for her property in the Wellington suburb of Karori were going to soar from around $2,200 to almost $7,200.

“We haven’t changed any of our conditions – this is just a rollover of our premium,” Egan told the publication.

She reportedly said that representatives of Tower have told her the insurer changed the way it allocates the insurance, and that it was all based on the address.

In April, Tower announced it would start pricing premiums according to how at-risk a property is to earthquake damage. The company’s chief executive Richar Harding, at the time, said its customers situated in high-risk regions like Wellington, Napier and Gisborne would face the worst of the increases. He also said the move to risk-based pricing was a fairer, more equitable way to operate.

“I was expecting a bit of an increase because we are in a risk area and building costs have gone up – but I certainly wasn’t expecting a 300% increase,” Egan said.

She added that online quotes with Tower for neighbouring properties showed premiums of about $3,000. Tower has reportedly since put her in touch with a broker, who found a quote from another company for about $3,000. Egan, who hadn’t heard of the company before, is still considering whether to take up that quote or continue looking.

 

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