MSE News

'My home insurer upped my renewal from £140 to £1,600' – why you should NEVER auto-renew

A MoneySaver whose home insurance policy was due to end this month was gobsmacked to find his premium would have shot up by more than 1,000% if he'd let it auto-renew.

Sales executive Billy Thompson, from Leeds (pictured right), has an annual buildings and contents insurance policy with Tesco Bank which cost him £140.28 and ends on 30 June. But he was stunned to receive a letter from Tesco Bank earlier this month telling him that it would automatically renew at a cost of £1,621.42 – almost £1,500 more.

Tesco Bank told us the eye-watering increase was down to its underwriter revising its risk assessment, but Billy says his circumstances haven't changed and he hasn't made any claims in the past year.

Unsurprisingly, Billy decided not to renew his policy and looked for cheap cover elsewhere – and he's now found a policy with Esure which offers him additional protection for his engagement ring and costs £182 for the year.

Billy's case is one of the most extreme examples we've seen of why you should NEVER let your insurance auto-renew. For full help on how to cut costs, see our Cheap Home Insurance guide.

'There isn't really an incentive to stay with your current provider'

Billy first made aware of the dramatic rise in his premium when he tweeted MSE founder Martin Lewis. His original tweet can be seen below (with the auto-renewal quote on the left and a quote he got when applying as a new customer on the right):

Billy told MoneySavingExpert: "I know renewal quotes can rise and I've seen Martin talking about this on TV, but I was absolutely not prepared for it to go up by over 1,000%, especially as I'd not moved house or had any claims.

"I rang Tesco Bank twice and they weren't interested, so I looked elsewhere and got a quote with Esure, saving me over £1,400.

"I think it's unfair that existing customers always seem to be worse off and there isn't really an incentive to stay with your current provider."

'Loyalty rarely pays – so NEVER auto-renew'

Steve Nowottny, news and features editor at, said: "Unfortunately this is an extreme example of a common problem – consumers are tempted by a cheap deal, then find premiums are hiked at renewal, with inertia stopping many switching.

"But the good news is it's easy to fight back – as Billy ended up doing. Loyalty rarely pays, so never auto-renew. Instead check what price you can get elsewhere as a new customer, then use that as a benchmark."

Insurers usually offer the best deals to new customers. When they send you notification of auto-renewal, insurers must now tell you the premium you paid last year, so you can compare prices (and Tesco Bank did follow this rule in Billy's case). But don't rely on this as a prompt to take action. If your renewal's coming up, jot it in your diary and check prices before it's due – the perfect time to compare is 21 days before renewal.

Always check what the best deal you can get as a new customer is, by getting quotes from comparison sites, checking insurers not on comparison sites and looking at deals not on comparison sites. Then call your insurer to see if it can match, or even beat, the best quote you find – if it can, you're quids in. See our Seven home insurance need-to-knows for more info.

What does Tesco Bank say?

A Tesco Bank spokesperson said: "We work hard to provide new and existing customers with the best value premiums, and are confident that we offer some of the most competitive prices available. All premiums are determined by a variety of risk factors that are set by our underwriters. In this instance, the underwriter revised their risk assessment, resulting in the increased renewal premium.

"Insurance renewal transparency enables customers to easily compare a renewal price with their previous year's premium. Customers can – and do – shop around. If customers would like to discuss their renewal quote, we can review their requirements and help tailor the cover to best meet their needs."

Have you had a ridiculous auto-renewal quote? Let us know at

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