Who's to blame for rising car insurance costs?
The cost of car insurance is spiralling upwards, with the average quoted cost of a comprehensive policy rising by 29.9% in the last 12 months. The insurers are blaming this on a "compensation culture". They say that increased compensation payments and legal costs mean that they have to recoup this outlay through increased premiums.
However, my understanding is that the number of road accident claims being made is not rising to that extent at all. The number of uninsured drivers is also decreasing, and the Commons Select Transport Committee recently concluded that uninsured driving has "not contributed to the recent steep increase in premiums”.
The Committee said that "the insurance industry has a big part to play in bringing premiums under control”. Further they said that they "have identified a number of actions the industry can take to help bring premiums down”. In general, they felt that insurers could do more to tackle fraudulent claims.
In my experience, insurers are too quick to point to the sheer volume of claims being made as the reason why they have to raise premiums. The public suffer, they say, because of a claims culture. The motor insurers claim that they have to pay out more than they receive in premiums, and make a loss on the business.
I would like insurers to show figures that justify increases of 29.9%. Should we believe that insurers tolerate making a loss year after year? Anecdotal evidence suggests that the price rises might just be an easy opportunity for insurers to boost profit. Many people don't bother to shop around when they receive their renewal quote, but simply sign up for another year. Making the effort to seek different quotes can lead to surprising savings, suggesting that price rises are not actually as inevitable as the insurers would have consumers believe.
Comments
#1 Jenni @ Apr 5, 2011
#2 Sarah Coles @ May 7, 2011
#3 Richard Powell @ Jun 20, 2011
#4 bicicleta con motor @ Aug 19, 2011
#5 PiExpert | Simon Peters @ Oct 11, 2011
#6 bebe hosep @ Oct 19, 2011