Young drivers could be put off getting car insurance as a result of the Budget’s increase in insurance tax, Tory MPs have warned. The jump from 5% to 6% was criticised by former minister Christopher Chope. He said it could also result in fewer people taking out health insurance putting more pressure on the NHS. Former Cabinet minister John Redwood also hit out at the move, which would raise £400 million a year, saying that the rise would impact already heavily taxed motorists. Mr Chope called for Insurance Premium Tax (IPT) to be frozen for health and vehicle policies. The standard rate is set to increase to 6% from January 4 next year as part of the Budget’s package of measures to cut the deficit. More
(AD Remarks ~ This certainly does not help anyone, let alone the new/young drivers with very high premiums. It may make some youngsters take the risk and drive without insurance, especially as fines when caught are significantly lower than the actual premium!)
Millions of parents are said to be breaking the law in order to save money on car insurance for their children. New figures suggest that 41% of parents deliberately lie when filling out policy applications. Parents are claiming to be the main drivers on the policy, when in fact it is one of their children who is the main driver, or owner of the car. The practice known as fronting potentially offers large savings but could lead to prosecution. Research by Co-operative Insurance found that 41% of parents were actually fronting policies at the moment, and 61% would do so in the future. More
(AD Comments ~ May seem a good idea at the time to save money, but will cost more in long run. All the details on the insurance documents must be correct, otherwise cover may be invalidated, which could major problems if a claim arises.)
Thursday, 29 April 2010 The number of crashed cars being put back on the road by car insurance customers over the past two years has increased by ten per cent, reports car insurance provider Swiftcover, whose cover can only be bought online. Last year, according to DVLA figures, more than 100,000 cars were written off in crashes then allowed back on the roads after passing checks. swiftcover.com has warned that these cars may not be covered fully by motor insurance policies and that some owners will not know this until they try to file a car insurance claim. Due to the damage they may have sustained during the crash in which they were written off, the cars tend to be worth much less and cost more to repair in the future. The result of this is that many car insurance providers will not offer full market value for the car and some motor insurance companies may even refuse to provide any policy at all. More
(AD Thoughts ~ When buying used cars, we must all be careful to check out the cars history. In some cases the written off cars, may only have very minor faults, easily repaired, which insurance companies may not deem financially viable to repair.)
Inserting black boxes into motor vehicles could help with any car insurance claim, a legal expert has suggested. Solicitor Ewan McIntyre claims that the devices are required by law in the US and can provide vital information on things such as throttle position, the vehicle’s speed and the brake light switch status. In addition, a black box could provide data on the car’s steering and braking system and whether seat belts were worn before a crash occurred. Mr McIntyre claims this sort of information would be a great help in determining who is responsible for an accident. More
(AD Thoughts ~ Could help in other ways as well, in the tracking of stolen cars for example. But against that many will sat its big brother watching our moves even more!)
Analysis by Direct Line has identified the UK’s top ten ‘crash for cash’ hotspots, as the insurer steps up its fight against fraudsters who cost every other motorist an average of £44 a year and delay payments for genuine car insurance claims. ‘Crash for cash’ fraudsters fake accidents by making unnecessary emergency stops at busy roundabouts or slip roads, forcing motorists to crash into them. They then make bogus claims to the innocent motorist’s insurer, often including fictitious injuries. Direct Line’s sophisticated monitoring of data and coordinated nationwide investigations means its anti-fraud team are aware of hundreds of sites that have been used by fraudsters, enabling them to catch the perpetrators and bring them to justice. The scams are estimated to cost up to £350 million a year increasing the car insurance premiums of honest drivers, as well as delaying payouts for claims that happened at known hotspots by up to three weeks. Further analysis has enabled Direct Line to map the entire country to highlight evidence of suspicious claims and determine the ten worst hotspots for the scams. By utilising this information alongside specially developed technology and methodology, Direct Line is able to catch fraudsters more easily and quickly. The top ten hotspots include roundabouts and slip roads throughout the UK. More
(AD Thoughts ~ This has become a good earner for many over the past few years. We all need to alert and watch others closely when we are on the roads, and more needs to be done to clamp down on offenders.)
A new form of insurance will allow young learners to drive your car without prompting a massive rise in premiums or endangering your no-claims bonus. Young Marmalade, which specialises in offering cars and insurance to new drivers, has come up with the policy aimed at learners called Provisional Marmalade. The cover costs between £90.95 and £99.50 per month. The price is based on where you live, and you will be excluded only if you’re looking to add a learner to a high-powered car. Because it’s a separate, fully comprehensive policy in the name of the learner driver, the parent’s no-claims discount is not in danger. The policy tackles the dilemma facing many youngsters, who can’t practise in their parents’ car because insurers won’t cover them. Around half of insurers won’t offer cover to those aged under 21 – some place the restriction at 25 – and most won’t allow you to put a provisional driver on your insurance. Even those who will allow learners to be added as a named driver frequently charge between £1,000 and £3,000 for a year. Yet the Driving Standards Agency advises learners to have 22 hours’ practice after they have had 45 hours of professional driving instruction and before taking their test. Nigel Lacy, of Young Marmalade, says: ‘The high cost of insurance has put off youngsters learning to drive or they are tempted to practise without insurance. We want to encourage safer motoring. The more practice they get, the better drivers they will be.’ The policy, which is underwritten by Chaucer, is being sold by motoring accessory store Halfords, where details of the scheme are included in packs of L plates, as well as by brokers and through the company directly. It covers only young drivers in the car you’ve stipulated at the outset. The AA is also planning to bring out monthly provisional driver cover, though it hasn’t yet decided how much it will cost. Learners can be covered to drive your car as long as it’s not worth more than £20,000. As with Provisional Marmalade, friends or other family members can supervise the learner in your car provided they have been driving for three years. The supervisor must be aged over 25 with Marmalade and over 21 with the AA. Once the learner passes their test, the policy ends or you can add them to your existing policy as a named driver. Some insurers, such as Admiral, Direct Line and More Than, will allow you to add a learner to your policy on a monthly basis. And if you have protected your no-claims discount, you won’t lose it if your youngster has an accident. More
(AD Thoughts ~ A good scheme for short term insurance for learners, with the higher cost to insure young drivers, this may well prove to be very cost effective as well.)
Around 36,000 parents are breaking the law by naming sons and daughters as a ‘spouse’ or ‘partner’ on their car insurance policy, our own research has found. swiftcover.com contacted policyholders over concerns with their cover and found that one in four admitted to ‘fronting’ by not putting down their offspring as a ‘named driver’. We estimate that the number of parents taking this fraudulent action has almost doubled in the last two years, with as many as 36,000 mums and dads guilty of doing so. Robin Reames, our claims director, warned those who front that insurers are clamping down on such behaviour, which ultimately ends up costing those who abide by the law and purchase car insurance honestly. “Trying to buck the system by fronting is not only illegal, it actually ends up costing law-abiding motorists if they are involved in an accident with a fronted driver who is actually an underinsured driver,” he added. More (AD Suggests ~ Policy holders may think that saving a few pounds justifies a little bending of the truth, but the insurance companies will not pay put in the event of a claim, if the policy is not correct. Everyone must make sure that all details are correct, then there is no trouble in the future.)
If you’re worried about getting hit by an uninsured driver, you might want to avoid these places. Listed below are the ten areas with the highest proportion of uninsured driver convictions. With uninsured driver accidents becoming an increasingly big problem for both motorists and insurers, price comparison website Moneysupermarket.com analysed almost 3 million car insurance quotes over a year and identified the places with the highest convictions. It said that the Scottish town, Sanquhar, in Dumfriesshire tops the list, with male motorists between the age 22-25 the main culprits. Amazingly, almost 30% of searches for insurance there showed up a conviction. Hebden Bridge, in West Yorkshire, and Glasgow were placed second and third in the list. Once again males in their early twenties were the main offenders. In fact, in all of the top ten areas men were the main offenders, except Bedfordshire – the only area with a female profile in the top ten. A surprise addition was London’s posh W11 postcode, where offenders were also older than the norm. Steve Sweeney, head of car insurance at moneysupermarket.com said: ‘It seems men under 25 are not only the country’s ‘boy racers’ but also ‘law breakers’. With half of the top ten profiles for uninsured drivers being males under 25, they are more likely to flout the law by driving without car insurance. ‘Unfortunately, the high cost of car insurance, especially for younger drivers could be the overriding reason for this.’ See the table of results
(AD Suggests ~ Punishments for uninsured drivers need to tougher, and enforcement on the roads more visable and effective.)
AA Insurance has seen a sharp increase in the number of drivers being stopped by police because simple number plate errors have been made on their insurance record. Such mistakes are coming to light as police automatic number plate recognition (anpr) equipment – used to identify uninsured drivers – becomes more widespread. Motorists who have made simple registration errors on their insurance applications are being stopped by police – and occasionally having their cars confiscated as a result. Mistakes, such as transposing letters or numbers or getting a 0 and O mixed up, may mean that automatic number plate recognition (anpr) technology, which is increasingly carried both on police vehicles and at fixed roadside locations, won’t recognise that the car is insured. Comment Simon Douglas, director of AA Car Insurance, says: “Over the past few months we have seen a sharp rise in the number of ‘mistaken identity’ cases. Where we used to get one or two calls per month from police to verify whether a motorist they have stopped is insured for this reason, it’s now 20 or more per week. “I see this as encouraging because it also means that police are becoming increasingly successful at catching genuine uninsured drivers as well as people who’ve made simple mistakes.” He points out that drivers are usually sent on their way after confirming they’re covered. But in extreme cases cars have been confiscated until a correct insurance document can be provided along with a statement confirming the car was insured at the time. “If you’re applying for your car insurance online, it’s easy to confuse letters and numbers such as 0 and O. It’s also surprisingly common for drivers to transpose digits. If you are applying for cover by telephone, similarly-sounding letters (such as N and M) can also be confused. Insurance staff can make mistakes too.” Douglas points out insurers send every customer a summary of cover, which includes all the information it has about a customer and his or her car, as well as the insurance certificate itself. “It is really important to check that this information is correct – especially the registration number. The data is used to update the national Motor Insurance Database, which is used by the police anpr equipment to check whether your vehicle is covered. He says: “Simple errors can result in a lot of wasted time and inconvenience for you, the police and your insurer – quite apart from the risk of temporarily having your car confiscated.” More
(AD Suggests ~ Always wise to check that all your documents are in order, as mistakes can easily be made anywhere in the arranging of insurance.)
Insurer launches direct web sales in the hope of attracting the safest drivers. Axa has become the latest insurance company to launch a website selling direct to customers. And it is hoping to entice the safest drivers with the promise of a maximum 90% no-claims discount which, it claims, is the highest in the market. It has traditionally sold through brokers alongside its Swiftcover brand, and is unashamedly targeting middle-aged drivers of low-performance cars who are most likely to have a claims-free past. Policyholders also get a courtesy car “whenever they are without a car following any valid claim for accident, fire and theft”, not just while their own is being repaired. Claims can be tracked, and amendments made to the policy, at any time via the website. Its target market is those around 45 and upwards. It has a maximum age for new customers of 80. The company says motorists with less than eight years driving experience are three times more likely to have both been caught driving under the influence of drugs or alcohol, or convicted of dangerous driving in the last year. Experienced drivers, it says, are also less likely to have been caught using a mobile phone while driving, and five times less likely to have been fined for driving without a seatbelt. Tina Shortle, marketing director for Axa Insurance says that at a time when prices are rising sharply in this market, “we felt drivers with a proven track record deserved more”. The official launch on Monday will be backed by a £10m marketing campaign More
(AD Suggests ~ The discount is large, but intersting to see how competitive the policies are.)
The average annual premium is now £564.19 – almost 20pc more than it was this time last year, according to market research firm Consumer Intelligence. Published: 10:36AM GMT 25 Jan 2010 Motor insurance premiums hit new high Photo: PA Motorists renewing car insurance policies face the largest annual hikes ever recorded, according to research from independent market research firm, Consumer Intelligence. The average annual premium is now £564.19 – almost 20pc more than it was this time last year, according to market research firm Consumer Intelligence. Those who have endured the biggest rise are 17-24-year-olds, with the average going up nearly 25pc to £1,489. Men are facing the most significant increases on their insurance premiums. In the last 12 months the average policy for a man has increased by 20pc to £599.65. This compares to an increase of 19.1pc to £523.55 for women. More
(AD Comments ~ Thats some increase, but over the past few years the advent of price comparison websites has helped keep premiums more competitive, perhaps we are now feeling the backlash of that)
Having points on your licence for speeding means your annual insurance premiums jump to an average of almost £1,000 a year, up £180 on last year and double the price paid by those with a blemish free driving record. Drivers have always paid more if they have a speeding conviction as they are considered more likely to make a claim. But now the extra amount they pay is increasing. Insurers are pushing up prices to recoup some of their losses stemming from a rise in claims during the recession. Steve Sweeney, head of motor insurance at moneysupermarket.com said: “Speeding increases accident rates so it’s hardly surprising insurers view a conviction dimly. “Serial speeders are worse off year on year and have to fork out nearly £200 more on average for their insurance premiums compared to last year. This is the harsh reality facing anyone who has multiple points on their licence.” A third of providers will not increase premiums for one blemish on your record, but serial speeders will find fewer providers willing to insure them and at increased prices. More
(AD Comments ~ Now motorists will now not just have to pay the speeding fines, but are hit harder in the pocket for their insurance. Increased expense may force some to change their driving behaviour)
We all know about the risk of young drivers. Now insurers are facing a wave of claims from women driving well into retirement. Men are worse drivers than women. That’s the inescapable conclusion from insurance statistics that show men, particularly those aged between 17 to 25, as the cause of the worst (and most expensive) smash-ups. It’s why young women pay just half the premiums of men the same age. But as Britain’s population ages, insurers have identified a new risk category – older female drivers. Guardian Money can reveal private data held by the insurers which shows that until their 60s, men have a worse accident record than women. But after that age, women are increasingly responsible for motor insurance claims and once they reach their 80s, are making far more claims than men of the same age. Some insurers are now demanding that women from the age of 75 pay 50% more for their car insurance than men, and, from 80, 100% more. Behind the figures is a dramatic surge in the number of elderly women driving on Britain’s roads. Licence statistics from the Department for Transport show that in 1976, only 4% of women who had driving licences were over the age of 70. In the 1990s that figure reached 20% and today it is 36%. Insurers are not sure why women become worse drivers than men as they grow older. But their claims data means they have no choice but to charge women more. The crossover point at which women start paying more than men has, according to AA Insurance, moved from 60 six years ago to below 50 today, although other insurers say they start charging more for women older than 60. A price test by Money this week found that by changing the title of a 75-year-old from Mr to Mrs and keeping all other details the same raised the premium by up to 53%. More
(AD Comments ~ Goes against the perception that males always have higher insurance premiums.)
Andy Murray might have thought he was getting a bargain by buying a red Ferrari F430 second-hand – at almost £50,000 less than the price of a new one. But the £100,000 he paid for the 196mph Italian supercar comes with a catch – the insurance costs the same again. The 22-year-old tennis star’s pride and joy is uninsurable by all but the most expensive specialist brokers, as Murray – who passed his driving test only five months ago – ticks every box for high-risk drivers. Enlarge Catch: Tennis star Andy Murray, who passed his test five months ago, with his new Ferrari Run around: The tennis ace unloads the boot of the new Ferrari As well as being under 25, a male and a newly qualified driver in a high-performance car, Murray’s celebrity counts against him as compensation costs after an accident could be huge. AA Insurance, which asked its panel of more than 20 insurers to estimate a quote, said: ‘Most wouldn’t touch it. And those who would are likely to charge £100,000 a year.’ More
(AD Remarks ~ Thats some premium! He surely can afford that with ease, but may not get much chance to drive the car, as he must be away from home a lot.)
Car insurance schemes restricting driving hours for young motorists could prove popular in future, an industry group indicated today (December 8th). Nigel Humphreys, spokesman for the Association of British Drivers, welcomed the introduction of a new insurance offer which discourages 17 to 25-year-old customers from driving at night. The scheme, developed by insurance broker Motaquote and underwritten by insurance provider RSA, involves a GPS-style device being fitted to policyholders’ cars. If the motorist uses their car between the hours of 23:00 and 5:00, an automatic £45 per night charge is issued. The scheme reflects existing accident trends, in that younger motorists cause a proportionally higher amount of road accidents and that these crashes tend to occur at night. Therefore, dissuading the drivers from using roads during these hours could improve safety and reduce car insurance claims numbers. Mr Humphreys said: “I think it’s something that young people are going to go for. I would prefer to see this formalised. More
(AD Remarks ~ Many drivers would not drive at that time of day anyway, so therer is a saving to be had on insurance)
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