The British Insurance Brokers’ Association (BIBA) is calling on the Government to implement an eight point plan to reduce the spiralling cost of motor insurance.
Addressing MPs at yesterday’s Transport Select Committee inquiry, BIBA’s head of corporate affairs, Graeme Trudgill, said: “We think the key priorities for the Government should be to introduce Continuous Insurance Enforcement, implement changes to reduce the cost of bodily injury claims and importantly signpost customers to a source of help.”
BIBA also submitted an eight point plan to the committee, with recommendations as follows:
1. Government must introduce Continuous Insurance Enforcement (CIE);
2. Signpost people to a relevant broker where they can find competitive cover (particularly young or non-standard drivers);
3. Regulate comparison sites to the appropriate standard;
4. Review Pass Plus;
5. Review the driving test;
6. Engage with Lord Justice Jackson’s review of civil litigation costs;
7. Delay the increase to insurance premium tax; and
8. Provide access to driving licence records.
The Association outlined the reasons for the recent increases in the cost of motor insurance as claims inflation, reduced investment income of insurers, competition, commoditisation, insurer withdrawals, uninsured driving and fraudulent claims.
A recent analysis by professional services firm, Towers Watson, concluded that the UK personal motor market will remain unprofitable until at least 2015, largely as a result of a 30% increase in the cost of fraudulent claims and an over-reliance on pricing in an increasingly competitive market.