Car Insurance
While competition in the general insurance market has led to an improvement in premium costs for the consumer, the car insurance market is one which has actually bucked that trend. As premiums continue to rise higher and higher each year, many are asking why this is happening?
The problems associated with the car market are every different to those of the general market, with car insurance companies seeing a number of situations developing, including:
Increased Repair Costs
It has been reported of late that the average car repair bill is in the region of £1,600 whereby the average premium is around about the £400 mark. This shows the potential loss each insurer has to face, in the event that they see an increase in claims over any given period.
There is also the problem of improved technology in cars, many of which are now run by complicated and ver6y expensive computer systems. When you also consider the increase in general labour and spare part costs, you begin to get a picture of the overall situation.
Unlawful Drivers
This is perhaps one of the most prominent of recent developments in the car insurance market, the number of illegal drivers on the market. While you would expect each unlawful driver to be liable for any damage which they cause, this is not always the case with many insurance companies being left to “carry the can”.
As you would expect, insurance companies have been very keen to transfer as much of this increase in compensation to valid drivers, via a general hike in premiums - something which has not gone down very well with the consumer.
Disharmony Among Valid Insurance Holders
The increase in general car insurance premiums, and the reasons for this, have not been well received by many consumers. This has resulted in increased claims, with borderline cases now being the subject of formal claims, where maybe a few years ago the holder would have paid for the cost themselves.
At some point in the future the penalties incurred by unlawful drivers will rise to such a level that the situation will slowly start to decline, but until then it is imperative that car owners continue to shop around for the best offers available for their situation.
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