The Committee has published its Twelfth Report of Session 2010–12, Cost of motor insurance: follow up (HC 1451) and you can download the full report from the committee’s website.

The Report criticises the ease of claim for an ‘unprovable condition’ and points out the wide proportional disparity between the rising number of claims and the number of car accidents.

Number of Claims

Number of casualties in road accidents

Conditional Fee arrangements also known as  ‘no win, no fee’ arrangements are blamed for this increase.

The committee points out that while many claims are genuine there is a lot of evidence that proves fraudulent claims such as ‘cash for crash’ staged accident scams .

The genuineness of claims for whiplash injuries, is hotly contested by the committee. Around 70% of car insurance personal injury claims arise from whiplash injuries to which there is often no objective proof of the injury. The committee propose to ask Parliament to change the law both for claims for whiplash and to make changes to the claim referral fees system.

Regarding Whiplash claims the report states:-

Where someone can demonstrate that they have suffered an injury, including whiplash, as a result of a road traffic accident for which they were not fully liable they should be able to claim and receive compensation.

However, in relation to whiplash, we are not convinced that a diagnosis unsupported by any further evidence of injury or personal inconvenience arising from the injury should be sufficient for a claim to be settled. In our view, the bar to receiving compensation in whiplash cases should be raised. If this were possible by means of an insurer taking a case to court and establishing new case law we suspect this would already have happened.

We note the Government’s argument that its legal reforms should reduce the money in the system and encourage insurers to defend claims more vigorously. If the number of whiplash claims does not fall significantly once these changes are implemented there would in our view be a strong case to consider primary legislation to require objective evidence of a whiplash injury, or of the injury having a significant effect on the claimant’s life, before compensation was paid.

Car Insurance Blog welcomes the changes proposed which should alleviate the pressure on the mounting claims reseverves that must be held by each car insurer to deal with future losses. However in return the British car buying public will expect to see much cheaper car insurance and the savings  not going to shareholders!

Otherwise the Governements exercise will have been pointless!

The law which prevents car insurance being calculated using actuarial rates determined by gender, will see all women drivers, but  especially those new or young drivers, pay a lot more in premiums. It will also see many specialist lady driver policies disappear.

Effectively the EU are saying that is wrong to blanket punish all male drivers with higher premiums, simply because as a set, they cost insurance companies more in claims. This is the price of equality!

Compare this Ladies to Saudi Arabia, where you face ten lashes simply for sitting behind the wheel of a car, and where you cannot buy womens car insurance!

Saudi Arabia is the only country in the world that bans all women , including foreign visitors from driving.

Since June 2011, hundreds of female drivers have been defying the ban, and presumably are driving uninsured, breaking the law designed to stop them from going out and committing sin!

Equality protestors have been arguing that even Mohammed’s wife rode a camel and donkey. Currently if women in Saudi Arabia want to go out, they have to employ a male driver or family friend to drive them. Taxis are also No No’s!

Yesterday a  Saudi woman was sentenced to 10 lashes with a whip for defying the country’s ban on female drivers. Shaima Jastaina, in her 30s, was found guilty of driving without permission. She has appealed the verdict.

It is the first time a whipping punishment has been handed down for a violation of the longtime driving ban in the ultra-right Muslim nation. Women drivers are usually stopped and interrogated if caught behind the wheel,but let go if they pledge not to drive again on fear of the whip.

How did Aston Martin get its Name?

Aston Martin have been building bespoke sports cars and coupes since the company was formed by Robert Bamford and Lionel Martin in 1913.

The company’s very first car was a one off competition machine using a 1400cc four cylinder Coventry-Simplex engine grafted into a a 1908 Grand Prix Des Voiturettes Isota Fraschini Chassis.

The name of the car – Aston Martin – was evolved from wealthy Kensingtonian Martin’s earlier successful jaunts at the Aston Clinton hill climb event in Buckinghamshire, in his 10hp Singer.

The name has now gone on to be the cooolest on the planet!

At Car-Insurance.tv we offer one of the largest bespoke Aston Martin car insurance schemes and online comparison systems for both current Aston Martins and Aston Martin Classic Car Insurance like the cool DB5 below!

The illegal faults noted include excessive wear, flat spots, cuts, impact damage and camber wear due to incorrect pressures or balance.

Car Insurance blog’s local KwikFit manager confirmed the statistics and pointed out that this was an example of how the recession was putting peoples lives at risk. He said that both sales volumes were down and most of the tyres they changed were either near the limit or beyond it. He also pointed out that it wasn’t just drivers of old bangers that were culpable but illegal tyres were common across the complete range of vehicles they saw.

In the UK the minimum legal tread is 1.6mm which must exist across 75% of the tyre surface. 1.6 mm is approximately equivalent to the edge of a pound coin.

It is illegal under the Road Traffic Act to drive with a bald tyre, one of which will get you three points on your licence and a fine. If you are caught with four bald tyres then you can expect an instant ban and a fine of anything up to £2500.

It is also a condition of all motor insurance policies that the insured vehicle is kept in a legal and roadworthy condition for cover to be effective, so clearly there are thousands of people driving around in the UK whose car insurance is invalidated by the state of their tyres. In the event of an accident or a claim many people could be in for a nasty shock!

Car Insurance premiums have been rising all year as the market hardens to adjust claims reserves.

A recent AA report of 40% additional costs to the average premium has sparked investigations into the industry by the FSA and OFT. On the same day as the announcements of the investigations are made the Government also announce that referral fees are to be banned.

To be fair, the OFT has been investigating anti-competitive practices and price fixing in the UK Motor Insurance market for nearly two years now, however since the ex-Justice Minister Jack Straw called claims management companies ‘pariahs’ and ambulance chasers in June this year, the association of higher car insurance premiums and the rising costs of claims, has been firmly established in the UK public’s psyche.

On further investigation by the British media it turns out that insurance companies themselves are the major benefactor of the referral fees and also the major provider of the personal data to the third party companies!

When insurance companies refer your data to an accident claims management company they receive anything up to £1000 per case. Because the fees cannot be awarded against the losing party, the cost of the fees is paid for by the accepting solicitors and cannot be recovered from the losing liability insurers. Effectively there is no subrogation of the costs and selling your data is a win-win situation for all the underwriting car insurance companies.

Admiral Insurance, which has many online faces including confused and elephant,  has stated that because referral fees account for 6% of their profits, any ban will inevitably lead to higher car insurance premiums.

Paradoxically though it has been the major insurance companies that have been moaning about CFA’s and no win no fee solicitors for years in the industry press, enough to have sparked  two major judical reviews.

So on the face of it, car insurance companies seem to have cut off their noses to spite their faces and the ban will almost certainly lead to higher car insurance premiums. The problem is that referral fees are only a symptom of the claims losses and not a component of the claims loss itself.

The Government obviously and mistakenly feel that if you remove the fee for ‘advertising’ or facilitating, then you will reduce the demand in the market.  Car Insurance Blog believes this is very naive!

If people are injured then they will claim. The real problem with the rising cost of motor insurance claims is the total cost of whiplash claims and the hourly charges of civil solicitors, both of which should be capped at levels much lower than current.

An interesting post from Car Insurance Buzz, the car insurance news site, is suggesting that it is cheaper and quicker to dial a number and talk to someone about your car insurance needs than typing for hours on a computer trying to compare car insurance quotes from the same providers.

Whats more, Buzz points out that you can always haggle extra cover or a cheaper premuim than the one you’ve found online when you talk to a broker over the phone.

Buying Car Insurance On The Phone For Cheaper Cover

At one time it was impossible to arrange car insurance contacts over the phone, however for the ten years prior to the arrival of online car insurance underwriting systems at the turn of the century, arranging car insurance on the phone was for many the de facto method. However buying direct from a car insurance company over the phone limited your choice and often was not suitable for all drivers.

Today, as well as car insurance comparison sites for the confident web user, some individuals still prefer to telephone for motor insurance. People like to talk. It could even be argued that getting covered on the phone is the smart way to buy car insurance today and the cheapest method…

When car insurance call centres were first established many were located in remote areas around the country and insurance companies did not have a local call centre in every town and city. Calling one of these call centres if not local on a local charge rate could work out expensive and this put many people off purchasing motor insurance over the telephone. Prior to this drivers had been accustomed to a face to face purchase over a insurance brokers or insurance company counter, located locally to where they lived.

Local rate and 0800 free car insurance telephone numbers were established to overcome this, but the insurance companies running the call centres found that the numbers were being abused by false purchasers, time wasters and  lonely people. As the call was free people could stay on the telephone for as long as they wanted and ask as many questions as they liked.

To overcome this and reduce time wasted by call centre staff, set scripts were designed that led the customer through the quotation and sales process. The staffs telephone script was adapted to finish the call if the caller was not suitable or the insurance company were not able to provide cover so for example if it is a stipulation of the cover that the insured to be does not have more than two accidents and the caller reports three, the member of staff can cut the call there and say that they would not be able to help. If the insurance company posed this question to the customer early in the call, this solved the problem!

Modern UK telephone call centres are now cheaper and well established. The technology used is now more efficient and integrated with the insurer’s back office computer systems for cost and time savings. Insurance companies have learnt the lessons of selling direct to the public over the telephone by staffing the telephone lines correctly when television or press campaigns are on.

As the price of call centres and complex phone systems became more affordable, insurance brokers have also invested in their own call centres, in order to provide a more efficient and extended opening time to their new and existing customers.

One such national broker with access to over 100 different car insurance policies is Adrian Flux Insurance, whose call centre offers more choice than the largest online car insurance comparison site. The call centre can be reached for free on 0800 0890182.

Call centres have had their problems, especially those major banks and insurers that moved their main call centres abroad to reduce costs. Fortunately now you have a choice of ringing either a local broker, national broker or insurance company to arrange cover.

Buying car insurance on the telephone can be done from anywhere today with mobile phones. The process is quick and easy and you know that you have the correct cover for your circumstances at the end of the conversation. It is also worth noting that when discussing the premiums for your cover on the phone, it is an accepted practice to negotiate and haggle for a better price than you have found elsewhere. You also have the knowledge that if you need to make a claim, a human being will be on the other end of the line when computer says no!

With so many contributing factors to the hike in car insurance premiums prices this year by 40%, it is a wonder if anyone is paying the true price of cover.

As we’ve been reporting here at car insurance blog for a few years now, uninsured drivers and the contributions that the insurance companies have to pay each year into a fund to cover uninsured losses, have been on the steady increase despite the introduction of the Motor Insurance Database (MID) and criminal convictions. The first excuse that the insurance companies gave in answer to why car insurance premiums were rising back in 2008, was to blame uninsured driving.

The BBC confirms the Motor Insurance Bureau’s (MIB) estimate that there are 1.4 million uninsured drivers on the streets of Britain.

In Bradford, the worst hotspot of uninsured driving in the UK, the number of uninsured drivers is incredibly seven times the national average!

Bradford Police report that uninsured drivers often cause accident and injury and fail to stop at the scene, costing hours of police time.

The BBC again makes the connection between uninsured drivers and young drivers and interviews a girl called Leah who sayas the best quote she could find on a car insurance comparison site was for £5000 and one was for an incredible £53,000!

This is why we are all paying more for our cover says the girl, who justifies young uninsured drivers as being priced out of the market.

A spokesman for the MIB said that the MID has been succesful in reducing uninsured driving by 25% which has been taken account in the car insurance pricing structure, but ultimately there are many other factors that contribute to the price paid by the motorist.

You can see the full interview at BBC News

Car Insurance – What are you paying for ?

The law states under the Road Traffic Act that it is a requirement to have third party road risks cover.

In this day and age when we telephone our insurance company to look for insurance cover for our vehicle, are we buying insurance or are we buying something else as well?

Modern car insurance now includes many additional covers to the original legal requirement.

We have comprehensive cover. This is all risks cover on your vehicle.

Approved Repairers
Your car can be repaired whether you are at fault or not and you do not have to wait for the third party to pay you to start the work.
You can have the car repaired upon authorisation of your insurance company. In this day and age the work required to be carried out on your car is undertaken by an approved repairer appointed by your insurance company.
The approved repairer would have agreed terms conditions and charges for parts and labour with the insurance company. In return, the approved repairer becomes one of the insurance companies approved panel of approved repairers and have the guarantee of work under the terms agreed.

If your car is a classic car or car that would require specialist dealers it is worth checking that they are on the panel or there would not be a problem in the event of a claim to use them. If in doubt, check with a specialist classic car insurance broker you may need a specialist policy.

Motor Legal Expenses
Car Insurance Blog thinks this is an essential add on to modern car insurance. It covers legal dispute in the event of a claim.  There are limits to the cover and higher limits maybe available for an additional premium.

Road side Assistance / Free breakdown cover
This can be added for an additional cost per year. >

Car Hire
This cover allows you upon authorisation of the insurance company to  hire a vehicle whilst your vehicle is being repaired.
It is worth looking at this cover to see if you are covered for a comparable vehicle or it is limited to the type of vehicle you can hire.
Normally the insurance company use a panel of hire companies to provide the vehicle.

Claims Helpline
This is normally a free or local rate telephone number which can be called to a call centre at the insurance company. They are trained to help you with your claim.

Check to see if your insurance company has provided this service free of charge.

It is always worth checking your car insurance documents sent from the insurance company you have placed your insurance cover with to see exactly what you have paid for and whether you need this cover.
Also check the excess that the insurance company has applied to your policy in the event of a claim.

Excesses
An excess is the amount that you have to pay towards your claim. This can be anything from £50 to £1000. Also check the other excesses that apply you may be penalised because of your age, convictions etc. If you think these limits are too high speak to your insurance company to see if the excess can be reduced to a more affordable amount. The problem with this is that insurance companies may want more money. Insurance companies normally provide a discount to the premium for higher excesses, so the higher the excess the lower the premium.

If in doubt, talk to a car insurance broker who can talk you through the covers and compare car insurance on your behalf.

Car Insurance rates and premiums are now being investigated by the UK Government.

So how do they come up with car insurance premiums?

The price of insurance especially car insurance is always an active subject. The television ads are crammed with insurance companies and comparison sites fighting for more business saying that there product is cheaper or better value than their competitors ,but how can they do this surely a car is a car ?

Car premiums are calculated using many factors with additional loads and discounts there are more than thirty. Many people think it is just the car they drive that sets the rate, in fact the major differences in prices comes from an assessment of  the driver risks.

The major rating factors that constitute the rate are:

The type of vehicle
The type of vehicle provides the insurers with details of engine size, car capabilities, seating capacity and from historical claims records the frequency and cost of past claims relating to that type of vehicle. They can also establish from their approved repairers the cost to repair and labour costs specific to that type of car.
All modifications should be advised to your insurance company as this can affect the value of your car and you may find that your policy is not suitable for your car in its modified state.

Mileage
This question allows them to ascertain the chance of you having an accident
As well as your driving experience it gives them an idea of your frequency to have an accident and the times that you are driving.

Location
Location of where the vehicle is parked over night is a rating factor. Inner cities can impose higher premiums than in rural areas.

Details about you
They will ask what connection you have to the car. Are you the main user? The main user maybe a younger driver and so this will have an affect on the price and excesses being charged.

Sex
This used to be rating factor for some insurers, but now due to legislation does not apply.

Age
Your age ascertains your driving experience and knowledge. The insurance company can look at their claims records and ascertain the amount of accidents from drivers of certain age groups. If you are a young driver you should check your policy document for additional excesses which apply. This is also applicable to inexperienced drivers.

Occupation
Your occupation provides your insurer with some idea of your driving lifestyle and it can be loaded or discounted for certain occupations.

Convictions
This gives the insurance company an idea of your moral code. It may mean that they will refuse you cover or they could impose a hefty loading to the premium or excesses that apply. It is all dependent on what the conviction was and whether it can affect your driving or propensity to claim.

Excesses applied
Some excesses are imposed for example inexperienced or young drivers.
Other excesses applied are voluntary. If the excess increases you are taking on more of the risk yourself and so the insurance companies can lower the premium as it removes the chance of many small claims which are time consuming and expensive to manage.

Car Insurance premiums are individual and will be different for each person and vary from company to company.

Given that there are so many rating factors involved in creating a car insurance premium, Car Insurance Blog is surprised that Car Insurance Companies can impose a 40% premium hike across the board and would be interested to know how they’ve actually applied this to the rates, especially as they were all recently reprimanded by the OFT for real-time price fixing!

Monthly Payment Methods

Before you spend ages on the Internet looking for the right car insurance, either for research or to compare car insurance prices and polices, it is worthwhile spending a little time and effort considering how you are going to pay for your car insurance.

The bottom line is that if you wish to pay for your cover on a monthly payment plan then you are more than likely to be paying more for your car insurance.

 Car Insurance on Debit

On average in the UK the cost of paying for monthly instalment car insurance begins at around 8% from the cheapest car insurers for a direct debit monthly payment plan and arrangement with your bank, and can rise to as much as 22.5% on average if you choose to pay by credit card.

Beware many of the larger car insurance companies who also charge a fee for credit card handling in addition to the interest charged by the funds provider.

 Your Individual Circumstances

When considering the best way to pay for your car insurance you must look at your own individual circumstances. Sometimes this means that you will end up paying more out of necessity.

Consider a young driver who has researched the market and been on all the car insurance comparison sites to find cover for his or her aging Renault 5. The best premium he could find was just over £2000 per year. Now this person only earns £16000 per year and cannot afford the annual lump sum payment method for cover for his car, whose value incidentally is less than the best car insurance quote provided.

This person is by economic means forced to take the more expensive monthly instalment payment plan option in order to be able to drive legally.

If you have the luxury, in these times of recession it would pay in the longer term to pay for the cover in one lump sum up front.

 Comparing Car Insurance

Whichever method of payment you decide is right for you, remember to include it in the options on the car insurance comparison form to avoid being offered quotes you have no means to pay for. Limiting your payment method also means limiting your choice and consequent higher premiums,

Yes, unfortunately if you choose to pay for monthly car insurance, you will not be offered so many choices of policy or cover when you compare car insurance, as you would for those companies who prefer you to pay instantly online.

The investigation comes after numerous outcrys, complaints and campaigns from the British media including the BBC and consumer advice organisations such as Which.

The OFT today issued the following press release:

OFT issues call for evidence on motor insurance

08 September 2011
The OFT today issued a call for evidence to establish the background to recent reports of rising UK private motor insurance premiums, and consider whether further work may be necessary to improve the way the market works.
UK annual comprehensive car insurance premiums are reported to have risen by as much as 40 per cent in the year ending 31 March 2011.
The OFT wants to establish the full facts, the reasons behind any increase, and whether there are any consumer or competition issues that need to be addressed to improve the functioning of the market.

As part of its work the OFT is interested in examining reports that car insurance premiums in Northern Ireland are significantly higher than they are in the rest of the UK, and understanding the reasons for any difference.
The OFT is asking insurers and others for their views on a number of aspects of the private motor insurance market that may raise competition or consumer issues, including:

The OFT will continue to work with the Ministry of Justice, the Financial Services Authority and other government departments regarding its work. It will gather evidence from a number of interested parties over the next five weeks, and plans to publish its findings in December 2011. Whether the OFT conducts further work in this area will depend on the evidence received.

Have The OFT Already Missed the Point?

Perhaps the best offer comes from Peugeot itself who are offering 3 years ‘free’ fully comprehensive car insurance as part of an aftercare package with new cars called ‘Just Add Fuel’ which also covers maintenance and warranty.

There are however quite a few restrictions to who can be covered:

• Drivers over 25 (Over 30 for 308 CC 156bhp models) and under 75.
• A maximum of 1 motoring conviction in the last 5 years (CU, MW, PC, PL, SP, TS codes only).
• Must have a minimum of 2 years No Claims Discount.
• A maximum of 1 fault or theft claim per driver in the past 3 years.
• All drivers must have a full UK/EU licence for a minimum of 2 years

The cover is provided under a scheme from a UK Insurance company and the normal rules for no claims bonus etc apply during the period of cover. The policy does have a high excess which means if you make a claim you’ll have to pay this amount. Another downside is that young drivers under 25 who might have been tempted by the sporty Peugeot 207 for example, are excluded.

If you don’t fit the criteria for new Peugeot car insurance, you should compare Peugeot insurance quotes here at Car Insurance TV.

Our new Peugeot Insurance comparison system brings you a very wide range of Peugeot Insurance schemes and policies with a choice from over 130 different FSA registered UK Insurance brokers, brands and specialist car insurers.

The specialist car insurance market can be a minefield for professionals who use cars in the course of their business, and this is no easier for taxi drivers and those who use their vehicles for private hire. Standard car insurance policies offer insufficient cover for full taxi liability protection, so it is essential that you seek out the advice of a specialist broker.

If you need taxi insurance there are bound to be lots of things running through your mind. Price will probably be the first thing on the list, followed closely by the level of cover you need and the time it’s going to take to find it. You’re probably also bracing yourself for the stress you think will be part and parcel of the process, but it doesn’t have to be that way – if you’re looking for taxi insurance, it can actually be surprisingly stress free.

All you have to do is have a clear idea of what it is you’re actually searching for, including the level of protection and any budgetary constraints you’re facing, before heading online to find the available options. If you keep in mind your main criteria you’ll find the whole thing far more straightforward, and remember that you should never sacrifice the level of cover in an attempt to save some cash. It can mean that you’re unprepared when you’re on the road and ultimately isn’t even necessary, because if you spend the time to look you’ll soon find a policy that can save you some cash whilst giving the level of protection that you’re looking for.

Don’t think that simply renewing your policy or picking the first quote you come across is the answer either, because that will invariably leave you disappointed. It’s essential that you compare the options because otherwise you’ll never know if you’ve got the best deal, and it’s always better to be prepared with the right level of cover. If you head to price comparison sites you’ll find the whole thing incredibly simple – you could save time and money by performing a few simple comparisons, ultimately leaving you with the perfect policy for your needs.

So, if you need taxi insurance, don’t be put off by the perceived time, cost and stress levels involved. If you know what you’re doing it can in fact be incredibly straight forward, and if you make sure to compare a few options and stick to your requirements you’ll have the perfect policy in no time.

Recent advances in security technology have made the theft element of a car insurance policy for a new car virtually irrelevant as the number of car thefts per year plummets.

With the introduction of new anti crash and driver alert technologies being developed by most car manufacturers, crashes and damage to other vehicles could soon become a thing of the past and in theory, less claims means lower premiums.

Japanese car manufacturer Toyota is leading the way……

Cars that stop or slow down automatically before another car, object or person in anticipating a crash are not new. But Toyota’s latest pre-collision technology adds a steering-control feature.

In the new system, Toyota uses cameras and a super sensitive radar called “millimeter-wave,” both installed in the front of the vehicle, to detect possible crashes such as a pedestrian crossing the road.

The vehicle calculates how braking and steering must be applied to avoid a crash, said chief safety technology officer Moritaka Yoshida.

“We must learn from accidents and keep making improvements in safety features,” he said.

The Japanese automaker declined to say when the feature may be offered on a commercial model, or in which markets, but officials hinted it was ready to be offered soon.

Toyota said it was aiming for zero fatalities and injuries, although it did not say when that goal would be achieved.

Fatalities have been declining in car accidents, because of better safety features, but deaths among pedestrians in traffic accidents have not gone down in Japan.

Protecting pedestrians is increasingly key, according to Toyota, which makes the Prius hybrid and Lexus luxury models.

Toyota showed what is called a pop-up hood, which rises slightly in a crash, to mitigate the impact of a pedestrian getting hit by a car, similar to features offered by European makers.

It also showed how parts of the rays from high-beam headlights could be blocked so that drivers could still see clearly what was ahead while headlights would appear to be on low beam to the driver in a car coming from the other direction.

Toyota also showed a steering wheel in development that measures the heartbeat of the driver to prevent crashes that can happen when drivers suffer heart attacks or strokes.

In computer networks they have had for years, a protocol called a PCADM packet collision avoidance and detection mechanism that effectively separates the data in an orderly linear fashion, making it impossible to get jumbled up or bottleneck.
Car Insurance Blog has seen the future!
Imagine ‘driving’ up the motorway in an electric computer controlled car. Each car is fitted with the collision avoidance and detection mechanism and is limited in speed to the safe area of space in front of it. Steering is controlled by onboard video, computer and the Car collision avoidance and detection mechanism. Oy yeah and you are automatically routed to your destination avoiding the traffic jams…and car insurance is an old concept!
Whatever happened to real motoring.