Insurance costs to go through the roof
The car insurance industry is in far worse shape than I had feared. In 2010 it was warned that it was being closely scrutinised by the House of Commons Transport Select Committee, which took the unprecedented step of investigating the industry for a second time in 2011.
Last year the Office of Fair Trading added to the woes of insurers by embarking on a long-overdue investigation of its own. Now there’s talk of the Competition Commission and Financial Services Authority wading in, too. But even with these respected and powerful political and consumer-protection organisations breathing down their necks, insurers, brokers, agents, comparison websites and others in and around the car insurance/banking business still hit motorists with inflation-busting price increases over the past 12 months.
The latest British Insurance Premium Index (BIPI), published on January 20, states that the “average premium” for comprehensive cover is now £1,458, with third party, fire and theft (TPFT) typically costing £1,572.
Drivers seeking comprehensive cover and willing to shop around pay a more reasonable £971 on average (up from £843 this time last year), according to the BIPI data. But at the same time, the TPFT customer who goes to the same trouble typically pays an unfathomable £1,496 for his certificate (£1,390 a year ago), BIPI admits. If these official figures are anything to go by, the TPFT customer pays more when he shops around.
Contrary to what you may have been led to believe, it’s not young drivers who are suffering the biggest percentage rises in insurance costs. Surprisingly, it’s men in their thirties and forties. The largest (percentage) annual rise over the past 12 months has been for males between 30 and 49 who, on average, suffered increases of more than 19 per cent – about four times the general inflation rate.
Labels: 3. Insurance News