CAR INSURANCE NEWS ROUNDUP: 7 DAYS ENDING 16 APRIL 2014:
Just because there’s nothing like tempering good news with bad, I’m saddened to report the recent car insurance cost drop isn’t going to last very long.
And when I say a cost drop I mean it – an insurance comparison site found that car insurance rates have dropped to their lowest point in for years. That’s an absolutely massive decrease in cost, and not just for the best drivers out there; the comparison site’s report found that it was even possible to find cheap car insurance for young drivers thanks to the across-the-board rate drops in the UK.
Unfortunately even as the good news hit, warning began to ring out across the motor car insurance industry that the miraculously low prices are actually too low to be sustained by the market for very long. The culprit, sadly enough, could actually be the Competition Commission’s report on car insurance companies due out in September.
Based on what the Commission finds, it could end up driving costs up for businesses unfortunately. It seems counter-intuitive but there’s a grain of truth here: the Competition Commission’s investigation is focused solely on private insurance, and if the Commission forces some sort of regulatory action on insurers as a result, car insurance companies may try to make up the revenue shortfall by hiking up the costs on car insurance for businesses.
If this does happen, it’s going to be one of the greatest ironies ever. The Office of Fair Trading referred the insurance industry to the Competition Commission over suspicions of artificially inflated premium prices in an effort to bring them down to more manageable levels, and the end result could be a price hike for businesses that need their vehicles insured.
It feels sometimes that the average consumer just can’t win, especially when it comes to large companies that do their best to extract as much money from consumers whilst providing as little product or service as possible. It’s this bloody capitalist business model that encourages this kind of behaviour on the part of businesses, and I can only imagine what the final result is going to be. Whatever it is, I have distinct suspicions that it’s going to be an absolute horrorshow for more or less everyone involved. Perhaps it might be time to start taking public transport?