Personal Finance: Nic Cicutti's column

I'M ALL in favour of bargains, hence the new "bargain deals" section we have started running on the back of the Your Money pages. What I don't like is half-bargains, those that look good but are really no such thing. Apart from anything else, they tend to insult consumers, making them think they are really smart while secretly treating them with contempt.

Which is why, despite all the hype at the beginning of this week, the motor-cover pledge from Barclays, jointly offered with Privilege Insurance, gets a thumbs-down.

For those who missed the details in our Midweek Money pages on Wednesday, here's the deal. Barclays is offering to undercut the renewal premium on offer from another insurer, for any motorist driving any car.

Put like that, it looks like a no-brainer. After all, what sensible motorist would want to turn down the offer of saving money by making one simple call?

Well I can think of plenty of people. Let's go back to basics. Most people hate the time-consuming process of phoning up six or seven insurers every year. Many will stick with their existing motor-cover provider and will stir themselves only if the renewal cost is exorbitantly high. Insurers know this - it is, after all, how many of them make their money.

What they do is offer initial cover at a preferential rate, only to hike it up at renewal time. They bank on clients staying with them for at least two or three years and moving only when absolutely necessary.

This is where Barclays comes in. By undercutting renewals, it does offer the prospect of some savings. But those savings would almost certainly be available elsewhere and, probably, would be greater if consumers shopped around. Yet Barclays is only offering to undercut a person's existing insurer, not any quote available on the market. Moreover, the deal is available only for 12 months. After that you are on your own again.

Sure, Barclays will save some of us money. And its entry into the mass motor insurance market will force competitors to keep the cost of their renewals down, so there are other indirect benefits for all motorists.

Yet I can't help feeling slightly cheated. After all, it is not impossible to put together a far better package than that. "Such as?" you may ask.

Well, how about simply offering to undercut any renewal premium by at least pounds 10. There might have to be some exceptions to this deal for boy racers and those with multiple driving convictions.

I can already hear the industry muttering that such a deal is impossible. I'm not so sure. A year or two ago I was contacted by one insurance broker who wanted to discuss offering this option for readers of the Independent. And why not? After all, Indy readers are fairly careful, young but not babies, quirky but not mad, just the kind of consumer group any insurer would like to have on board - or so these blessed readership surveys would have us believe.

While the discussions foundered for some trivial reason, they indicate that some things are possible even when the perceived wisdom says they aren't. Were Barclays not so consumed by the desire to vacuum up their rivals' policy-holders at minimum cost, they might have come up with something better.

As it is, motorists seeking the best deal on their car insurance still need to shop around for it, rather than rely on just one call. And Barclays leaves me with a bad taste in the mouth.

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