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X-Ray production team X-Ray production team | 14:49 UK time, Monday, 10 October 2011

The street in Brithdir
The street in question...


Moving home can prove a financial headache, but for one young couple moving just 450 feet left them with more of a migraine.

Rhys Evans and his partner Nicole Olsen moved one parallel street along in their village of Brithdir earlier this year after managing to finally get on the property ladder.

Rhys told X-Ray for them it was an easy move: “We just carried the whole lot. No cars, no vans, just our hands.”

So far, so cheap but little did they know the headache it would cause with their car insurance company, the RAC, when they telephoned to change their details. Nicole said, “I rang them up and the gentleman on the phone said I had to pay an extra £178 for moving over one street.

“It’s crazy. We’ve just moved house and it’s something we really can’t afford to spend extra on top.”

But how had the RAC arrived at this conclusion? Nicole told us the last letter of their postcode had changed and that seemed to have made all the difference, “They basically told me that we were [now] living in a high risk area”.

Rhys said they couldn’t understand it, “It’s identical streets. We are living on the same side as what we lived in in Herbert Street, we’re parked on a hill like we was in Herbert street. Neighbours are the same, the road is used by the same amount of cars as they is in Herbert Street. So there is no difference.”

Despite explaining this to them numerous times, Nicole said the RAC wouldn’t budge. So X-Ray sent Rhodri to investigate. Would he find that their neighbouring street was so deserving of its high crime risk category?

Rhodri spoke to some of the local residents. Michael Evans and Elizabeth Williams told him they love living there, “Very safe to be honest with you. It’s a local family community and everybody knows each other in the street and the village”.

The crime stats tell us the same – there’s only been one crime on each street in the last six months.

A number of companies use postcode profiling to decide what marketing material you’ll receive. One of them told us according to their records both of these streets are inhabited by practical and enterprising people living on well built council estates. But we were told by a local resident who’d lived there for 53 years that the properties had never been council run in her lifetime.

So how do insurance companies use post codes?

Ian Brown, an insurance expert from Williamstown-based Motaquote told us there are a number of factors companies taken into account, “What is the area like? How many cars are there? How busy are the roads? It’s very much statistically based. Sometimes statistics can probably work against you”.

He added, “Insurance companies do have some different attitudes to risk, so it’s worth shopping around”.

But Rhys and Nicole couldn’t shop around – the cost of cancelling their policy was basically the same as the increase in price for moving addresses.

We had a look around for them and found moving them again could save or cost them a lot more. If they lived in a central Cardiff postcode with the same car and driving history, it could cost them more than £1,200. But if they moved to Rhos-on-Sea they would be paying just under £400. Tenby would be just under £600 and Rhyl £685.

And so we turned to the RAC and asked them what had happened and why they believed the couple had now moved into a more risky area. They told us it had all been a mistake. They’ve apologised and reinstated their previous policy. They’ve also given them £50 as a goodwill gesture.

They added, “It is standard industry practice that risk assessment is based on various factors, one of which is geographical location and this can influence the price. However, on this occasion, the underwriter has confirmed that, in this instance, an error occurred and no price increase should have been applied”.

But will anything change? We went back to them to ask if this means they’ll be reviewing their policies. They gave us the following statement, “In response to Miss Olsen's concerns we have reviewed the process with the underwriter and those involved. As a result of this review we have reinforced our existing training and reminded our advisors of their responsibilities when responding to customer queries.

“RAC places great importance in the ongoing monitoring of the performance of our staff to ensure our customer experience is of the highest standard."


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