Staveley Head

Staveley Head

March 18, 2010 03:00 ET

State Owned Banks Will Rip You Off When You Buy Their Insurance Products

FLINT, UNITED KINGDOM--(Marketwire - March 18, 2010) - A recent investigation by the Daily Mail has revealed that banks which were bailed out by the tax-payer, and are now predominantly state- owned, are overcharging their customers by hundreds of pounds compared to the premiums charged by insurance brokers and on-line providers. The investigation discovered that RBS/Natwest and Lloyds Banking Group are selling car, home and travel insurance to their loyal customers at a rate which is obscenely high.

The figures showed that in some cases a family of four would pay £1,330 more by going with the Halifax, a retired couple would be £364 worse off by choosing RBS/Natwest and a young couple who were customers of either of these banks would pay up to £493 more than if they went to a comparison site. The young couple would be charged £927 by RBS/Natwest, £869 by LloydsTSB and £793 by HSBC. But online they would only have paid £434, and £529 through an insurance broker. A family insuring just their home in Bristol would pay £361 through LloydsTSB, £354 through Halifax and £338 through RBS/Natwest. But an independent insurance broker would have charged just £135.

The findings do not surprise Staveley Head, one of the UK's leading van insurance providers. A spokesman said "For many years the banks have been selling insurance at a price far higher than the market rate because they have a captive clientele. Usually the customer will have approached the bank for a mortgage or a loan to buy a car or to extend their overdraft to pay for a holiday, and that is the time the banks will offer them the relevant insurance policy. The customer feels that if they decline the insurance the bank will not extend to them the required finance and they feel intimidated and obliged to buy the policy."

James Daley, money editor at Which? says "It comes as no surprise that the banks' insurance products are expensive. Part of the reason they fight so hard for your current account business is so they can cross sell. They often have a good first year rate, then ratchet them up in year two, knowing most people don't shop around."

The same banks that have cost the tax-payer billions of pounds in the last two years because of their greed and incompetence, are now paying a negligible interest rate on current and savings accounts, charging enormous penalties for minor overdraft infringements, charging the same mortgage lending rates as they did five years ago when the Bank of England base lending rate was 5% and not the 0.5% it is now and raising the charges on credit cards. All to pay for undeserved fat-cat bonuses.

Using a panel of insurers allows Staveley Head to find the most suitable and best priced cover for individual clients, while a quote can be obtained swiftly through their online quote system. Further details are available at www.staveleyhead.co.uk or the company can be contacted at their headquarters in Flint.

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