Car insurance companies called greedy for referral fees

As it has come to light that car insurance companies have been skimming about £4.7 billion annually from referral fees related to the motor accident claim industry, consumers have begun to feel disillusioned with their apparent greed, experts say.

The average motor car insurance policy is on track to cost more than £1,000 within the coming year.  This, alongside rocketing petrol porices, has led many motorists in the UK to look for discount car insurance as a way to control the costs associated with owning a car.

With an average of around £3,900, drivers are paying at least 20 per cent more than they were last year when it comes to the costs to run their cars.  Fuel costs alone rose to £1,721 a year, up from £1,400, according to recently released research findings from one car insurance comparison site.

The cost of the average comprehensive car cover is now £892 a year.  Insurance experts predict an additional 20 per cent increase by the end of 2011.

Moreover, motorists in select postcodes are suffering due to increased levels of fraud in their areas.  Some of the worst areas for fraud are selected parts of Bradford, Manchester, East London, and Birmingham, sources say, yet fraud is not the sole reason for rising car insurance rates.

Rate increases are not due to a higher accident rate, either; in fact there are significantly less injuries or fatalities on the roads in the UK, as 1989 casualty figures are nearly 120,000 higher than they were in 2009.

However, the costs of each individual insurance claim have been rocketing upward.  Insurers blame a ‘perfect storm’ of ambulance chasing personal injury lawyers, uninsured drivers, and fraudulent claims ratcheting up the cost for the honest motorist.

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