OFT set to get stuck into motor insurance industry

8 September 2011

tiny car2 The cost of car insurance has risen by 40% over the past year or so, but hey, that’s okay isn’t it? The insurers wouldn’t put the prices up by so much if they didn’t need to now would they? Everyone shut up and think about something else.

But wait a moment – it’s not that cut and dried. The Office of Fair Trading aren’t prepared to let it lie. They’re about to launch an investigation to see if we’re being unfairly overcharged. Phew!

We quoted that 40% premium rise figure at the top of the story but that’s just an AVERAGE. 17-22 year olds are now paying a typical premium of £2,431 per year, a hike of 64% on the past year.

The insurance companies are citing factors such as an increase in fraudulent and personal injury claims, claiming that the whiplash epidemic (570,000 claims in the past year alone) is making it tougher for everyone.

Otto Thoresen, the director general of the Association of British Insurers, said he saw the OFT investigation as an opportunity to highlight the cost pressures motor insurers are facing. “The motor insurance industry has not been profitable for the last 16 years” he said. Hopefully the OFT will find it if that is indeed the case or not.

TOPICS:   Consumer Advice   Insurance


  • Daniel
    About time...
  • Brad
    Not profitable? Yeah cause not son...
  • Al
    The motor insurance industry lost 20p for every £1 of premium in 2010 ... much as we'd all like to think that they're ripping us off, they're actually not. They make a nice profit on all the extras they sell (breakdown, guaranteed hire car, legal cover etc) but if you ignore them and go for the basic premium then chances are you're costing the insurance companies money.
  • motorcycle
    Great paintings! This is the type of information that are supposed to be shared around the web. Disgrace on the seek engines for not positioning this submit upper! Come on over and seek advice from my website . Thank you =)

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