Car insurance

mx5ladydriver

Hi, Can anyone explain to me how car insurance works?

I'll admit I've had a claim this year BUT it was a tornado that hit my car. Yes, I appreciate that it was 'my fault' someone has to be blamed and as there was no other driver involved it had to be my fault.

I'd still like someone to explain why my insurance premium has gone up by £200 a year! Am I really that higher risk, will another Tornado attack my car! I have 9 years NCB I've only ever claimed 3 times in my life and they were all the other drivers fault and I've been driving for nearly 30 years! And to top it all I have a perfectly clean licence.

forgotmyname

You had a claim or incident, staitistics dictate that your likely to have 2 more claims in a fairly short timeframe.

Aretnap

The premium is based on a computer program. The computer program is not sophisticated enough to distinguish between every type of accident - it simply notes the fact that you've had a claim, and applies a loading based on the average risk associated with people who've made claims before. So it doesn't really distinguish between you, someone who had a tree fall on his car, someone whose car was stolen, and someone who drove into a wall.

Arguably that's a bit unfair on people who've had a claim due to a freak piece of bad luck - but ultimately there's a trade off between analysing every possible variable, and keeping the cost of running the system reasonable.

In theory you could look for an insurer with a more personalised approach, where you could sit down in an office for tea and biscuits with your underwriter, have a chat about the exact circumstances of your accident, and see whether he thinks it marks you out as a higher risk. But you'd inevitably have to pay quite a bit extra for that level of personalised service - quite possibly more than you'd save relative to getting a quote from a computer. And another problem with that model is that it would be difficult for a new insurer to check whether you were telling the truth about the exact circumstances of your claim - insurers do share some information about claims, but not in that level of detail I believe.

Aquamania

mx5ladydriver wrote: »

Hi, Can anyone explain to me how car insurance works?

I'll admit I've had a claim this year BUT it was a tornado that hit my car. Yes, I appreciate that it was 'my fault' someone has to be blamed and as there was no other driver involved it had to be my fault.

I'd still like someone to explain why my insurance premium has gone up by £200 a year! Am I really that higher risk, will another Tornado attack my car! I have 9 years NCB I've only ever claimed 3 times in my life and they were all the other drivers fault and I've been driving for nearly 30 years! And to top it all I have a perfectly clean licence.

When you make a claim (that is not recovered in full from a third party) you normally lose part or all of your NCB. (unless it was protected ).
NCB protection, where offered, normally adds about 10% to the premium.

And the insurer may add a loading anyway.

SueMaggie

It's not just you, Association of British Insurers' figures show that the cost of the average comprehensive policy rose by 10% in the first quarter of this year, so there's a general trend upwards.

Bumpy ride for motorists as average motor premiums on the rise

rudekid48

You don't say how much the claim was for but insurance is a commercial business, like it or not you cost the insurer money last year so they will rate you accordingly at renewal.

Look at it this way, if you were the insurer and collected a premium of £500 then paid out a claim for £5000, would you not increase the premium at the next opportunity?