With the collapse in the value of used cars and cars being written off rather than repaired because of their low value in relation to repair cost, does it then follow that we should all see a dramatic reduction in our insurance premiums as a result ?
Think I know the answer to this one but if payouts are lower how can the insurance industry justify not reducing the premiums ?
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As you say gmac - it aint gonna work like that in this country or probably in the US. Due to the way our wonderful PM de-regulated the city at the same time he gave the BoE independence (that is the 'other' bit he never tells people about) you will more than likely find that our insurers own allot of the mortgage debt that is now being written off as bad debt. Also as allot of insurance also comes from the banks and investment companies they need to get some cash back somehow and that will be through increased premiums in conjunction with the interest rate cut that will not be passed on tomorrow.
Edited by Pendlebury on 05/11/2008 at 18:24
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You got in there with a reply Pendlebury just as I was about to add to my original post.
How much of an increase in premium will you accept knowing full well the payout you receive, should you have an accident, will be much reduced these days ?
Edited by gmac on 05/11/2008 at 18:26
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Good question gmac and allot of attention has been diverted from the liquidity crunch to focus on the US elections at the moment but the ramifications and consequences of this financial mess have along way to go yet and will affect us all unfortunatley.
You know the score, city boys screw up and we pay the consequences. All done under the noses of the government and FSA though Brown & Darling have done a magic job in ensuring they are seen as the saviours and not the people that enabled it all to happen. You have got to hand it to Gord - he has managed to get himself of the hook almost with allot of people including journalists. The problem is that we will be paying for this for many years yet. Our house prices are in decline (maybe no bad thing to an extent), our cars are worthless and we have still to pay the increases in VED yet and we are now borrowing at a scary rate and excuse me for being thick, but I thought it was debt that got us into this mess, so it does not stack up that we go into more debt as a nation to get out off the mess. Personally I think GB is just making as big a mess as he can to hand over to the tories by which point we will probably be bankrupt.
I suppose this thread falls into the other credit crunch post so I'll shut up now.
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>>How much of an increase in premium will you accept knowing full well the payout you receive, should you have an accident, will be much reduced these days ?
No increase, in fact I expect a reduction.
Reason for this, on my insurance form motor reduced to £3k value from £5k last year, preliminary quotes are slightly better than last year, around 10ish% less. But it will be January before I have to re-insure so gord knows what will have happened to the world by then.
Keep smiling
CBG
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Reason for this on my insurance form motor reduced to £3k value from £5k last year...
I don't suppose you would mind this if the £3k was some kind of GFV (for the duration of the policy over the year) in the event of a loss however, depending on the type of car I suspect anything over 200g/km and less than seven years old will carry on depreciating very heavily.
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7 yrs ago I changed to Esure - I had a full NCB in 2001
The premiums have fallen year on year despite buying newer (& more expensive cars)
Now £300 for a Gp 16 & Gp 11 cars -
In 2001 I was approx £275 each! (£550!!)
Cannot complain as the Comparison sites have reduced premiums - for me at least!
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But on this basis, the premiums for anyone who keeps his car for several years should drop steadily with the car's value. It doesn't happen - or does it?
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One fatal accident can cost more than all the premiums you pay in a lifetime. The cost of a fatal accident bears little relation to the value of the cars involved. I think the average fatal accident currently costs in excess of £1,000,000.
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the average cost of a bump is under £1,000 I believe - this masks however the very large claims that occasionally crop up for Personal Injury - Fortis (or rather their re-insurer) paid out circa £50 million for the accident on the railway line/motorway bridge killed several people and injured many more when an express passenger train & a coal train hit the Land Rover on the track.
If your car is a normal car valued between a few thousand and a few tens of thousands Comp Ins will not vary that much on the value of the car - the premium is weighted by the driver(s)' driving / claims history.
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"I think the average fatal accident currently costs in excess of £1,000,000."
Fatal crashes are the cheap ones. It's the ones with serious head injuries that cost millions. Medical advances (if that's what it is!) can keep PVSs alive for years.
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>>at the same time he gave the BoE independence
Did he? Are you sure? It looks pretty dependent to me these days.
The BoE's sole remit is to control inflation based on a target given to it by the Government. The Government wanted interest rates lowering, so it changed the inflation target from RPI to CPI.
Now CPI is 5%, yet interest rates have dropped by one third this month. Entirely Government driven, and nothing to do with the independent BoE's inflation remit.
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My UK car insurance is due at the end of the month and I've just received my renewal through. Increased by a shade over 24%.
I have protected no claims though I know they get around this by increasing the basic premium.
I made a claim in February for a smashed passenger side window, nothing was taken from the car only the standard £60 excess for a new glass.
Guess I'll be onto findmecarinsurance.bomb in the morning.
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This was exactly what happened to mine.. We returned to the car and found it damaged.. had protected no claims so thought just claim my insurance.. Car sorted.. 6mths later renewal came through.. big hike.. phoned them up, told them that i had protected no claims.. told that only protected my bonus.. did,nt stop the policy price going up because of claim.. told them we were'nt even in the car when it was damaged so how could we be classed as at fault.. They say just the way it goes.. so i cancelled my car, my wife's car and my house insurance with them.. told them that's the way it goes.
Confused.com anyone?
Edited by Pugugly on 06/11/2008 at 21:54
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>So i cancelled my car, my wife's car and my house insurance with them.<
Do you really mean Cancelled (in the middle of the insurance period)? That does look like cutting off one's nose - it could cost a bit.
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As it turned out it actually saved a good bit of money in the 2 years since so they did do me a favour.
The galling thing is that i had been with them for 9yrs, 2 cars,house and travel insurance with them and not one problem ever.. i even recommended them to friends and family.
It was the sheer arrogance of them, even when i tried to argue my points of protected no claims and the fact that the car was parked when it was damaged, that made me take all my business elsewhere.
No way did we deserve the increase in premium that they quoted for
As for cutting off one's nose, i don't like being taken advantage of..
Edited by jimbano on 06/11/2008 at 23:39
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