Car insurance, are they the biggest fraudsters

motorguy

Car_54 wrote: »

It's not surprising that Aviva makes a large profit - they're the biggest insurer in the UK and the 5th biggest in the world.

UK motor insurance is a small part of their business. In 2015 the profit before tax on all their UK general insurance (including motor) was £140 million, or 3% of premium income, and was actually DOWN from £406 million the previous year.

Would you say 3% was excessive?

Well OBVIOUSLY their profits were so low because they were charging themselves so much for their own repairs

:rotfl:

boatman

"According to the Association of British Insurers (ABI), for every pound in compensation insurers pay to accident victims, another 87p is paid out to personal injury lawyers, with average legal costs adding £2,100 to the cost of each claim.
But honest drivers are paying the price. According to one leading insurer, if you took an insurance policy of £450 a year, about £220 of the premium is charged to cover the cost of whiplash claims, fraud, legal fees and tax"


So if this practice is bad for insurance companies, why have they not stopped selling accident details to claims companies? Could it be that on a percentage basis, a higher premium, means higher profits?

Mercdriver

force_ten wrote: »

the problem is not with the insurance companies as such the problem is with the claims management companies that are milking the insurance companies

the biggest cost is the credit hire car companies they are costing the insurance companies millions every month, you could buy a new car for the amount that theese companies charge for a few weeks vehicle hire, I was talking to a guy whose van was involved in an accident and he had a VW transporter from a credit hire company that was costing £400.00 a day because he needed a van with a tow bar

Sorry but that is horlicks. The insurance companies choose to deal with accident management companies knowing they can pass on the extra cost to the general public. They could always refuse to deal with accident management companies because of the higher costs involved, but they know they can just add a private tax on to everyone.

Did you ever notice that the only companies making money in a recession are insurance companies?

Car_54

Mercdriver wrote: »

Did you ever notice that the only companies making money in a recession are insurance companies?

I hadn't noticed that, probably because it isn't true.

intransient1

I have just changed from leasing back to my own car and needed to insure it.
I did the online insurance costs comparisons and the companies that aren't on them.
I did one quote with all my correct details but used a different name and email address for a quote without the non fault claim.
Then I did a quote in my name with the non fault claim on.
I have always believed that not fault claims where the monies are recovered do not affect your insurance costs.
The quotes I received were an eye opener, without non fault claim circa £500.
With the non fault claim circa £600 which is a 20% increase.
This is the equivalent of a 20% loss in no claims bonus and needs to be looked into by the FCA.

Cornucopia

I had a no-fault accident claim a couple of years ago, and I was completely shocked as to the clamour of calls from different parties wanting to manage the claim.

I first spoke to my own insurers at the time (Admiral) who told me that they "had assigned" their Accident Management company (Albany Assistance) to handle my claim, as that meant that the repair could proceed immediately without waiting for formal acceptance of blame from the other party.

I asked them to clarify whether this would be a claim on my insurance or that of the the other party and they gave some reason (that I can't remember) why it would be easier and better for all concerned for me to do as they said. A day later, I received a call from the other party's Accident Management company pleading with me to assign them the repair.

It's pretty clear to me from my personal experience (and from the various articles on the subject) that there are more complex financial considerations at work than simply the old-fashioned notion of paying to insure and then making a claim that is settled using good-quality work, fairly priced.

If I had to speculate, it seems likely that the AM companies are either part of the same group(s) as the insurers, or there is an exchange of referral fees, or they inflate repair costs, or a combination thereof. I wonder whether the AM may actually pay the insurer a referral fee, and not the other way around (that would explain insurers' keenness to use them - not only do they save the cost of administering a no-fault claim, but they get a kickback (sorry, fee), too).

The AM then proceeds to place the work, and presents a top-end invoice to the other party's insurer, together with a bill for a hire car. There must be some inflation of costs there, otherwise it would make no sense to receive a pleading call not to place the work with them.

To add insult to injury, Admiral nearly doubled my premium at renewal. Fortunately, because my NCD was not affected and the no-fault claim had been fully paid by the other party, all the other insurers' quotes were unaffected.

So, whilst the word "fraud" remains on the "most overused" words list on MSE, there is something not right about the whole Accident Management element of the insurance industry, and I suspect that the overall rise in premiums is partly down to it.

BeenThroughItAll

intransient1 wrote: »

I have just changed from leasing back to my own car and needed to insure it.
I did the online insurance costs comparisons and the companies that aren't on them.
I did one quote with all my correct details but used a different name and email address for a quote without the non fault claim.
Then I did a quote in my name with the non fault claim on.
I have always believed that not fault claims where the monies are recovered do not affect your insurance costs.
The quotes I received were an eye opener, without non fault claim circa £500.
With the non fault claim circa £600 which is a 20% increase.
This is the equivalent of a 20% loss in no claims bonus and needs to be looked into by the FCA.

READ ALL ABOUT IT!


"Person involved in accident considered a bigger risk than someone not involved in an accident SHOCKER!"


Hold the front page. No, wait. Don't.

boatman

BeenThroughItAll wrote: »

READ ALL ABOUT IT!


"Person involved in accident considered a bigger risk than someone not involved in an accident SHOCKER!"


Hold the front page. No, wait. Don't.

Has anyone ever produced the data of the increased risk of insuring someone involved in an accident that was not their fault?

There are accidents that are a close call but there are some that really are clear cut, like a legally parked car being hit, those are the ones I'm thinking of.

Cornucopia

BeenThroughItAll wrote: »

READ ALL ABOUT IT!


"Person involved in accident considered a bigger risk than someone not involved in an accident SHOCKER!"


Hold the front page. No, wait. Don't.

In your rush to disprove something you don't agree with, you've not read all the relevant posts, including the tail end of mine.

In my case, ONLY my present insurer bumped up my premium - the rest of the market was unaffected, and I went elsewhere. Admiral are known for this.

I'm sure that someone "prone" to no-fault claims might overall be a worse risk than someone with no claims at all, however, I fail to see how one isolated no-fault claim can be indicative of much more than bad luck. It's an interesting example of the implied fair play of the Insurers counting for very little at the end of the day.

BeenThroughItAll

Cornucopia wrote: »

In your rush to disprove something you don't agree with, you've not read all the relevant posts, including the tail end of mine.

In my case, ONLY my present insurer bumped up my premium - the rest of the market was unaffected, and I went elsewhere. Admiral are known for this.

I'm sure that someone "prone" to no-fault claims might overall be a worse risk than someone with no claims at all, however, I fail to see how one isolated no-fault claim can be indicative of much more than bad luck. It's an interesting example of the implied fair play of the Insurers counting for very little at the end of the day.

Well, your post wasn't there when I started writing mine, so I'd have been hard pushed to read it.


The simple fact is that many insurers DO consider those who've been involved in one or more no-fault claims to be a higher risk than those who have not. It's just a fact that they do, and the reason they do is that they have years of evidence of claims made that demonstrates to their satisfaction that, statistically speaking, one or more no-fault claims in a proposer's history increases the likelihood of further claims.


Every case will be different, but I still do not understand why people find it so surprising and/or shocking that once there is a claim in their history some of the market consider that a reason to increase their premium. This isn't news, it's happened for many years.