Insurers blame everyone but themselves for high rates

CAR INSURANCE NEWS ROUNDUP: WEEK ENDED 24 OCT 2013:

In what can only be described as a classic example of ignoring reality, car insurance companies once more claimed they have no role in high premium prices.

In fact, the Association of British Insurers put forward a study recently that attempted to break down the costs for the industry and where they come from, claiming that costs from personal injury cases are the biggest problem, with whiplash claims by themselves accounting for one fifth of car insurance rates. In fact, the only thing that cost more than that was found to be the costs of replacing written-off vehicles or repairing damaged ones at 29 per cent of the cost of a premium.

Between whiplash claims and other types of personal injury claims, a total of 44 per cent of your premium is eaten up by these costs every year, according to the ABI.  Of course, nobody wants to talk about how there are several car insurance companies currently under investigation by the Competition Commission for price-gouging and price-fixing when it comes to repair work at garages; neither does anyone want to admit that the high level of insurance claims could be partially driven by referral fees, which are when insurers sell the personal details of customers that have been involved in an accident to a personal injury law firm or claims management company.

Meanwhile, another independent survey from Aviva, the largest car insurance provider in the UK, declared that motorists pay an additional £118 on their premiums every year as a result of whiplash claims. This of course flies in the face of the fact that there are fewer road traffic accidents occurring now than just a few years ago, yet claims figures keep rocketing upwards – and Aviva attributes it to fraud.

So once again a massive insurance organisation refuses to shoulder any of the blame for the current market conditions. Now don’t get me wrong – I’m sure that there are fraudsters that are out there looking to make money by engaging in ‘crash for cash’ scams and the like, but again why doesn’t Aviva just admit that they’re making matters worse by taking referral fees for the personal details of their own customers?

Heavens forbid that one of these big firms actually admit that they made a mistake in their quest for the almighty profit. Instead we’ve got a bunch of right bastards playing ‘pass the buck’ and blaming anyone and everyone they can for the woes they brought down upon us all – and we’re stuck holding the bag!

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