While it seems that every insurer and motoring organisation has their own measure of how the insurance industry is faring, the AA recently claimed that motor car insurance costs are finally beginning to fall.
The British Insurance Premium Index from the AA found that the average ‘shoparound’ price of comprehensive cover dropped to a ‘more affordable’ £1,132 before the beginning of April, a decline of 1.1 per cent. An average of the five least expensive car insurance rates quoted by approximately 50 car insurance companies, the Shoparound premium price had already increased by 7.7 per cent over the year to March 2012, and while this may sound high, this is actually the smallest increase to occur over the past four years – in comparison, the annual increase from last year weighed in at a distressingly weighty 40.1 per cent.
While the news seems to be good, the AA proves that every silver lining has its cloud, as the motoring organisation was concerned that the price drops were unsustainable in the longer term. AA’s Insurance division, Simon Douglas, expressed his fears that the industry could be poised for a repeat of the activities in 2009 if prices do continue to decline, as premiums rocketed upwards suddenly in the wake of a long period of stagnation that had led to industry losses.
The research findings from the AA indicate that insurers may be taking early steps for legal requirements going into effect this December that bars the use of gender a a risk assessment criterion.