BBC Panorama: The Great Car Insurance Swindle

Peter_Piper_picked

lisyloo wrote: »

Peter, you haven't really given a clear picture of why you think UK insurance is a rip off.
I'd need more info on your analysis to agree or disagree.
All you've said is it's cheaper in other countries and NCB discount isn't good enough.

Personally I think you need to present your analysis if you want anyone to take you seriously.
Of course there may be those who have a tendancy to agree/disagree, but anyone serious, objective and open minded will want to see more analysis which is so far lacking.

I didn't realise I was obligated to give any pictures? however, take a look at the majority of curent complaints on the forum, that might give you the clear picture you require.

Analyse the above.

Spiderham

Peter_Piper_picked wrote: »

A more than' fair NCB premium drop per year of no claims, would be a good start. (Don't tell me this already exists!)

But what would that be in your opinion and how do you determine it?

Peter_Piper_picked wrote: »

I didn't realise I was obligated to give any pictures? however, take a look at the majority of curent complaints on the forum, that might give you the clear picture you require.

Analyse the above.

Unfortunately vocal opinion does not equal fact. You are hardly likely to people shouting from the roof tops how brilliant their car insurance premium is; everyone would like it cheaper.

My analysis of your comment is you are venting and have no basis for your opinion, yeah? On a serious not though, I am personally quite interested on how people thing insurance should be determined so if you do have any ideas let us know.

Peter_Piper_picked

Spiderham wrote: »

But what would that be in your opinion and how do you determine it?




Unfortunately vocal opinion does not equal fact. You are hardly likely to people shouting from the roof tops how brilliant their car insurance premium is; everyone would like it cheaper.

My analysis of your comment is you are venting and have no basis for your opinion, yeah? On a serious not though, I am personally quite interested on how people thing insurance should be determined so if you do have any ideas let us know.

I don't proclaim to know how to fix the current situation, but certainly something needs to be done, and again my opinion, I don't think anything is being done, other than more administration fees, higher premiums and so on.

Seems its just a little too easy for people to scream whiplash or well, look at the Panorama programme; seems people are making a healhy living from other peoples rising premiums.

How I see the situation...

I know poeple from 26-55+ years of age that are receiving extremely larger premiums than they were 2-3 years ago, with no claims, and with just "positives, additiona years NCB" on file, they are not rewarded fullstop.

How about fair assessment of people with no claims, from 1-10+ years?

How about a "real" reward (Large Drops) for people that simply have no claims or have made no claims for x amount of years?

Most of us if not all have paid 1-10+ years contributions into insurance firms, helping those firms to become as big as they are today, and some without so much as a single claim!

I'd rather have a 3 fault claims within x amount of years and you resit your driving test than have things the way they are today.

A safe driver is a good driver, yes? why should he/she be punished for someone running into his/her parked car whilst he was, lets say, in a meeting at the office? why should his/her premium rise?

Give credit where credit is due?

Spiderham

Peter_Piper_picked wrote: »

I don't proclaim to know how to fix the current situation, but certainly something needs to be done, and again my opinion, I don't think anything is being done, other than more administration fees, higher premiums and so on.

But that's the problem you see. It's very easy to say it's all wrong and it could be done oh so much better but you have to ask the basic question of all. Can it? Then, if so, how?

That is pretty much how every insurance company will work. After all, if they are able to rate more equitably they will make a larger profit/smaller loss. The insurance market is extremely competitive and price focused meaning people generally go with the insurer offering the best rate. Therefore if you are too cheap (and loss making) on one area you will pick up more business, if you are too expensive (but profit making) you will hardly get any. Therefore the best method is to price so that you make a similar profit in all areas.

I agree it is very easy to claim for whiplash as it is hard to prove either way, but that is an access to justice/litigation issue. Insurers can only move to mitigate claims and recoup losses, changing the culture of the UK is very different.

What would you see as a "real" reward? Why don't you think insurers offer it? (As in what reason do they have for not doing it?) Surely if that was affordable and made sense someone would be doing it and making a killing.

I'm going to make a very facetious point here but I think it does help make my point.

Why can't we buy milk for much cheaper, say 20 pence per pint? It's far too overpriced. The problem is all these farmers making a fat profit out of muggins here.

Do you see the point? It's very easy to claim something is wrongly priced without a frame of reference. You do get the driver who has never had a claim before in 20 years writing off their car and/or causing a personal injury claim worth hundreds of thousands of pounds. You need to write contingencies into the rating structure to pay for that sort of event.

One idea I have occasionally heard banded about is the idea of a % return premium for not claiming. On paper this sounds like a brilliant idea but it wouldn't work with market economics. To pay for this, the up front premium would be much greater and therefore people wouldn't go for it.

Sorry if I seem to be being dismissive of you here, that is not the intention. My point is that it really is in insurers interest to give credit where it's due. Many complaints are also conflicting. You get people complaining how they've never caused an insurer an ounce of trouble or cost them anything so should have a cheaper premium then people complaining about increased premiums for convictions and non-fault claims or admin fees for change of details or cancellation. All of these cost the insurer money (either by dealing with the request/issue or increased "acquisition costs" because they are more likely to claim).

I really do think things could be improved in some way but there will always be losers and winners in every change and it's very hard to work out how to make these.

mikey72

Spiderham wrote: »

Out of interest did you try a low risk person too? I'm guessing you may well fall into that category if the price for your 17 year old female is that (comparatively to others) low. Not trying to catch you out here, honestly have no clue myself.

The reason I ask is that if it is high risk is cheaper it may be down to less discrimination. Then again it could be generally cheaper due to reduced claim values, more sophisticated rating models, fewer claims, lower expenses levels from insurers or even a more homogenised group of risks. One other thought is a less competitive market meaning less advertising acquisition costs, I know in some countries the traditional broker or direct application is more common, along with greater loyalty to brand meaning insurers spend less on (direct and indirect) marketing leading to lower costs.

I didn't personally, but looking at ex-pats forums, it's generally much cheaper for low risk customers as well.

Spiderham wrote: »

But what would that be in your opinion and how do you determine it?




Unfortunately vocal opinion does not equal fact. You are hardly likely to people shouting from the roof tops how brilliant their car insurance premium is; everyone would like it cheaper.

My analysis of your comment is you are venting and have no basis for your opinion, yeah? On a serious not though, I am personally quite interested on how people thing insurance should be determined so if you do have any ideas let us know.

https://forums.moneysavingexpert.com/discussion/3161478

https://forums.moneysavingexpert.com/discussion/3252640

Spiderham wrote: »

I'm going to make a very facetious point here but I think it does help make my point.

Why can't we buy milk for much cheaper, say 20 pence per pint? It's far too overpriced. The problem is all these farmers making a fat profit out of muggins here.

Very comparable example.

British milk price was controlled in the uk by the Milk Marketing Board.

It was expensive, and delivered by the milk man.

Now the cartel is broken, and supermarkets import much cheaper milk from europe, and sell directly to the customer for a much cheaper price. UK milk has come down in price to compete.
And the farmer still manages to make a profit.

Spiderham

All good points Mikey I have to agree.

I am actually quite interested in the foreign insurance thing. I'd love to know the deep reason for the differences, but unfortunately I won't be able to see those insurers' figures to find out, it makes no sense. Same position as your in with UK insurance it seems ;-)

My point with the milk is that I can complain it is still overpriced and that it should be a lot cheaper than the current 48p (I think) because I feel it costs me too much. Doesn't necessarily mean I'm right though.

Have to agree that service is a major plus point, generally that is actually what matters if and when the proverbial hits the fan. Personally I am not a fan of weasel words in policies if they exist or gamesmanship when offering to settle and I do not in any way agree with excessive charging, it's not fair. It also, in my opinion goes against the concept of utmost good faith central to insurance contracts. By the same token, sometimes think that prima facie seem unfair actually aren't when you do a bit of digging, auto-renewal is very helpful for some people for example.

Ideally both sides, insurer and insured, would be 100% up front and honest at all times with the insurance arrangements (indeed they should under aforementioned utmost good faith). Unfortunately what we see is a bit of claok and daggers and gamesmanship from both sides, partially trying to get one over on the other side, partially trying to make up for perceived past and future unfair losses.

But hey, that's a free market and human greed for you.

mikey72

65p a pint from the milkman.

As for autorenewal, it's the same as buying the milk from the supermarket for the 48p, and then the next time you go in, being charged 65p, unless you notice and complain, then you can get it for 48p again.

Auto renewal would be ok if the insurers were obliged to pricematch, or at least offer the same price they would if you were a new customer, or else to cancel with no charge, rather than the policy of having an "open cheque", and hope the customer doesn't notice, then try to apply a punitive charge if they do.

Spiderham

Yeah, do agree price hike (above standard rate increases) with autorenewal does make me a little uneasy. There may be small intro discounts but they shouldn't be able to get it significantly cheaper by coming in as a new customer. I don't always get it though as if they come back in via an aggregator, that's another fee to the aggregator,

To be honest, that is probably why our insurance is more expensive here, referral fees and commission at eveery step of purchase and claim adding to costs.

Mind you, that's the price we pay for living in a free capitalist society. Imagine the alternative, a society where nothing gets done without a bribe or inducement. Wait, hang on a minute.

mikey72

I wouldn't say insurance was free market capitalism, they're good examples of corporate capitalism though.

adamc260

Many insurers prop up their motor book with other policies and sources of revenue. Car Insurance isn't that profitable for insurance companies with the exception of a few insurers. Mass competiion drives prices down which drives down profit.. More customers require more staff etc etc.