Insurance costs all over the place – sometimes even too high

CAR INSURANCE NEWS ROUNDUP: WEEK ENDED 13 Mar 2013:

Insurers are all over the place with their premium pricing lately, and car insurance rates are fluctuating wildly enough to cause serious problems for many.

On the one hand, car insurance companies have begun to back off from the heightened prices that female drivers were slapped with back in December at the hands of the European Court of Justice and its ruling that gender differences can no longer be taken into account when it comes to determining premium pricing. Prices for women went up by around 14 per cent just after the ruling went into effect, the British Insurance Brokers’ Association reported, but now it seems that average premium prices are beginning to come back down to earth a bit.

Experts say that the new price drop is actually a knock-on effect from the EU gender directive, as the market simply can’t bear the heightened prices. With demand dropping for the overpriced insurance cover, insurers have no choice but to drop their prices in order to remain competitive and keep their revenues up.

Of course there’s another problem altogether that reared its ugly head as well while premium prices were ridiculously high, and that’s the fact that there could be more people getting behind the wheel without valid motor car insurance as a result. In fact, research from one major car insurance comparison site found that as many as one out of every 7 British driers have been driving about without the proper cover – and that younger drivers, who routinely suffer from crippling insurance costs are the most likely to break the law.

The comparison site discovered that a full 6 per cent of recent survey respondents admitted to driving without insurance on purpose, and an additional 6 per cent have borrowed the car of a friend or family member without insurance as well.

Out of those who didn’t take out cover before getting behind the wheel, around 12 per cent of them said that they simply didn’t have enough money to purchase an insurance policy. This is twice the number of those who indicated money problems in 2012, where only six per cent of survey respondents indicated being unable to afford the cover.

This definitely concerns me, and if you ask me it’s obvious proof that price increases have had a serious and negative impact on the ability of not just people to pay for proper cover but also is making roads in the UK just that much less safe. The more people that are driving without insurance, the higher the likelihood that you’re going to get into an accident with one of them, and good luck in that case!

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