Insurers Charge Widows and Widowers More for Insurance - A 'Bereavement Penalty'
When a single person's partner dies, the cost of their insurance premiums is often expected to decrease. However, many insurers have a surprise in store: they increase their rates by up to 15% when the surviving policyholder moves from being the joint name holder to being the sole policyholder.
The Guardian has spoken to two new widows who were hit with hefty premium hikes after their husbands passed away. Kay Lawley of Ageas and Alison Roper of Swinton Insurance claim that they were shocked and dismayed by the increases, which seemed arbitrary and unfair.
Lawley was quoted £301 for her car insurance when she was still married but saw this jump to £348 after her husband died. Her home and contents policy also rose from £1,039 to £1,161 - a 12% increase. When Lawley questioned Ageas about the rise, the company couldn't provide any reason other than saying that's what comes up on their screen.
Lawley feels this way because, despite being the sole policyholder now, nothing else has changed in her circumstances. "I was already the lead name on both policies and nothing else has changed," she says. "How can such decisions come at a time when the surviving partner is in no fit state to argue the toss, and also when a household's income is likely to be reduced?"
Alison Roper of Swinton Insurance experienced similar issues with her home and buildings insurance policy. Despite being informed that the cost would increase when her husband died, she was still hit with an astonishing £441 rise. When she contacted the company about it, they blamed their system for the issue.
These cases highlight a worrying trend - insurers are using complex algorithms to calculate premiums, which can lead to unfair decisions. Campaign groups like Fairer Finance argue that this is undermining public trust and calls for greater transparency from regulators and government.
"Current pricing practices are accelerating complexity," says James Daley of Fairer Finance. "These cases demonstrate the lack of humanity in many insurers' pricing algorithms. Even if there's a statistical basis, they're unsensitive - and it's worse that insurers can't explain their reasoning because their models are considered trade secrets."
Ageas has since refunded Lawley's additional premiums and offered her compensation, but she will lose the joint policyholder discount when her policies are renewed. This issue seems set to continue affecting many newly bereaved customers until insurers start being more transparent about their pricing practices.
The Association of British Insurers claims that providers have a right to make commercial decisions on prices based on risk appetite and any change in personal circumstances can affect this. However, the question remains as to how widespread this 'bereavement penalty' is and why it's perceived as so insensitive by customers who are already grieving.
When a single person's partner dies, the cost of their insurance premiums is often expected to decrease. However, many insurers have a surprise in store: they increase their rates by up to 15% when the surviving policyholder moves from being the joint name holder to being the sole policyholder.
The Guardian has spoken to two new widows who were hit with hefty premium hikes after their husbands passed away. Kay Lawley of Ageas and Alison Roper of Swinton Insurance claim that they were shocked and dismayed by the increases, which seemed arbitrary and unfair.
Lawley was quoted £301 for her car insurance when she was still married but saw this jump to £348 after her husband died. Her home and contents policy also rose from £1,039 to £1,161 - a 12% increase. When Lawley questioned Ageas about the rise, the company couldn't provide any reason other than saying that's what comes up on their screen.
Lawley feels this way because, despite being the sole policyholder now, nothing else has changed in her circumstances. "I was already the lead name on both policies and nothing else has changed," she says. "How can such decisions come at a time when the surviving partner is in no fit state to argue the toss, and also when a household's income is likely to be reduced?"
Alison Roper of Swinton Insurance experienced similar issues with her home and buildings insurance policy. Despite being informed that the cost would increase when her husband died, she was still hit with an astonishing £441 rise. When she contacted the company about it, they blamed their system for the issue.
These cases highlight a worrying trend - insurers are using complex algorithms to calculate premiums, which can lead to unfair decisions. Campaign groups like Fairer Finance argue that this is undermining public trust and calls for greater transparency from regulators and government.
"Current pricing practices are accelerating complexity," says James Daley of Fairer Finance. "These cases demonstrate the lack of humanity in many insurers' pricing algorithms. Even if there's a statistical basis, they're unsensitive - and it's worse that insurers can't explain their reasoning because their models are considered trade secrets."
Ageas has since refunded Lawley's additional premiums and offered her compensation, but she will lose the joint policyholder discount when her policies are renewed. This issue seems set to continue affecting many newly bereaved customers until insurers start being more transparent about their pricing practices.
The Association of British Insurers claims that providers have a right to make commercial decisions on prices based on risk appetite and any change in personal circumstances can affect this. However, the question remains as to how widespread this 'bereavement penalty' is and why it's perceived as so insensitive by customers who are already grieving.
Insurers Charging Widows & Widowers More for Insurance: A Major Problem! 
insurance companies are just getting worse! they're basically hitting people with a bereavement fine 
after their partner dies, like it's no big deal 
. the fact that they can't explain why premiums go up is just unacceptable 
. these algorithms they use to calculate prices sound super sketchy 
. i mean, who thought it was a good idea to punish people who are already grieving with higher insurance costs? 
it's like they're taking advantage of vulnerable people at their most desperate time 
. this whole thing needs more scrutiny 
.
Can you imagine getting a 15% price hike just because your partner is no longer on the insurance policy? I mean, I get it, insurers have to make money, but come on! 
It's like they're taking advantage of people when they need help the most. The whole system sounds super unfair and emotional. Like, what even is a 'bereavement penalty'? Sounds like a bad joke to me 
I remember when I was younger, my aunt had her husband pass away and she got a huge increase in her insurance premiums. At first, I thought it was because of some new medical condition or something, but then I found out that insurers were doing this to all the newly widowed people 
It's like they're taking advantage of someone who's already vulnerable 
. I mean, what's the logic behind increasing insurance premiums after a person loses their partner? They're basically asking someone in grief to shell out even more money on top of everything they're already going through 
. And the fact that these companies can't explain why they're doing this is just ridiculous 
.
. I mean, what's the logic here? You're not even taking into account that the person is now single and struggling financially, right? 
.
... Insurers charge more for single folks after they lose their partner? Like what's next? More funeral costs?! 
. How can you make decisions based on algorithms that don't even consider the human impact? Like, what if the person who died was paying more than their share of the bills? Shouldn't that be taken into account? This 'bereavement penalty' is just another example of how companies are putting profits over people 
.
. I mean, what's the logic behind increasing premiums 15% when a single person becomes a sole policyholder? It doesn't make sense to me 
. We shouldn't have to rely on trade secrets to know how our insurance companies calculate their prices 
. This 'Bereavement Penalty' is a perfect example of why we need more accountability in the insurance industry 
.
Sometimes insurance companies seem to make decisions that affect us when we're most vulnerable, like after losing a loved one 
.
that's not fair, right? And with nothing else changing in Lawley's life circumstances... I mean, how can insurers expect her to argue back when she's still grieving? 
This "Bereavement Penalty" is literally pricing people's lives at twice the cost! 
We need to hold insurers accountable for their complex algorithms that don't consider the human impact. 
UK insurance market value is expected to reach £43.8bn by 2025 
I think its pretty messed up when insures raise your rates by 15% just because ur a single person now 
. It's like they're more interested in hiding behind complex algorithms than taking care of their customers