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Moves Afoot to Curb Spiralling Cost of Motor Insurance

 


The British Insurance Brokers' Association (BIBA) has called on the Government to implement an eight point plan to reduce the spiralling cost of motor insurance.

Graeme Trudgill, BIBA's Head of Corporate Affairs, told MPs at today's Transport Select Committee inquiry that there was no market failure.  He added that signposting customers, particularly young drivers, to a source of help was also a vital part of the solution to access affordable insurance. 

Graeme Trudgill said: "We think the key priorities for the Government should be to introduce Continuous Insurance Enforcement, implement changes to reduce the cost of bodily injury claims and importantly signpost customers to a source of help.

"Signposting is an important solution at no cost to Government. There are key benefits to consumers, particularly those in the more vulnerable age groups. This will help more people find insurance, meaning fewer are left uninsured and unprotected."

BIBA submitted an eight point plan in writing to the committee which it believes will help to tackle the increasing cost of insurance. The eight point plan recommends:

1. Government must introduce Continuous Insurance Enforcement (CIE);
2. Signpost people to a relevant broker where they can find competitive cover (particularly young or non-standard drivers);
3. Regulate comparison sites to the appropriate standard; 
4. Review Pass Plus;
5. Review the driving test;
6. Engage with Lord Justice Jackson's review of civil litigation costs;
7. Delay the increase to insurance premium tax; and
8. Provide access to driving licence records.

BIBA outlined the reasons for the recent increases in the cost of motor insurance as claims inflation, reduced investment income of insurers, competition, commoditisation, insurer withdrawals, uninsured driving and fraudulent claims.

Unfortunately this omits the outrageous scandal of Credit Hire that can result in a car hire cost of as much as £40,000 while a car is being repaired. 

Nor does it tackle ambulance chasing charlatans that encourage spurious injury claims.

So while BIBA may be protecting its own interests, it has failed to protect the interests of policyholders and its proposals are, in fact, extremely unlikely to curb the ludicrous increases in insurance premiums that policyholders are being subjected to and which make car insurance completely unaffordable for younger drivers. 

 

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