Why is insurance so expensive?
Discussion
Insurance is expensive because the cost of reimbursing people injured in accidents is very high.
Insuring my £8000 Integra for £600 per annum cost Elephant £1.5m a little while ago.
There's lots to be done to minimise the scourge of false or minimal whiplash claims, however the ultimate problem is that cars can cause a lot of damage to people and property, meaning your premium is scant consolation in the event of most claims.
Insuring my £8000 Integra for £600 per annum cost Elephant £1.5m a little while ago.
There's lots to be done to minimise the scourge of false or minimal whiplash claims, however the ultimate problem is that cars can cause a lot of damage to people and property, meaning your premium is scant consolation in the event of most claims.
Nicky86, really ? Do you really believe that, or is it something else that you've heard down the pub ? Any evidence to back up your wild observations ?
You may not accept this, but most Insurers actually make a loss on the Motor Policies they underwrite - it's only what they do with those premiums by way of investments that actually earns them a profit - though profit in the Motor market has been hard to come by for the past 10 to 15 years.
You may not accept this, but most Insurers actually make a loss on the Motor Policies they underwrite - it's only what they do with those premiums by way of investments that actually earns them a profit - though profit in the Motor market has been hard to come by for the past 10 to 15 years.
Mr Daytona, yes. I've been driving since I was 18 now I'm 29, I've never had or caused a accident so I would like to see where the insurance companies have made a loss from me. My first car was a 1.2 Fiat Punto, cost to insure that was £1600 only recently I've gotten my insurance down to a reasonable £400.
Car insurance I feel is a legal protection racket, government say i must have insurance so the insurance companies now have a free hand to charge what they like and do then act as a cartel not to undercut each other. Why can this be legal? Because the government can take their 6-20% insurance premium tax.
Remember theirs a difference between insurance broker and underwriters!
Car insurance I feel is a legal protection racket, government say i must have insurance so the insurance companies now have a free hand to charge what they like and do then act as a cartel not to undercut each other. Why can this be legal? Because the government can take their 6-20% insurance premium tax.
Remember theirs a difference between insurance broker and underwriters!
I'm well aware of the difference between a Broker and an Underwriter (though I never made mention of this in any event) but I have been involved in the Insurance Industry for nearly as long as you've been alive, so I do have a (small) insight into what happens.
As for the premiums you have paid, on a best case scenario it's probably £15,000 or so. If I don't write out a cheque for that amount at least twice a day I'm not dealing with enough claims files to justify my wage. Its not my style to belittle anyone on PH but you are seriously out of your depth on this issue. Whilst you may be the safest/luckiest driver on the road, sadly this doesn't necessarily apply to the other X millions of drivers.
For the avoidance of future doubt though, the (tiny) premiums you have paid go but a fraction towards the billions of pounds in compensation, costs and staffing etc that Insurers pay out every year. It really doesn't even register.
As for the premiums you have paid, on a best case scenario it's probably £15,000 or so. If I don't write out a cheque for that amount at least twice a day I'm not dealing with enough claims files to justify my wage. Its not my style to belittle anyone on PH but you are seriously out of your depth on this issue. Whilst you may be the safest/luckiest driver on the road, sadly this doesn't necessarily apply to the other X millions of drivers.
For the avoidance of future doubt though, the (tiny) premiums you have paid go but a fraction towards the billions of pounds in compensation, costs and staffing etc that Insurers pay out every year. It really doesn't even register.
Be thankful you don't live in North America. I successfully transferred my full no claims when I emigrated to Canada 10 years ago. I've had no claims since moving here, and I pay $1,200+ per year on each of my vehicles, which is 3x more than I used to pay in England. The only upside here is engine size and make/model of the vehicle has far less relevance to the premium than driver profile, so you may as well drive something interesting.
Mr Daytona said:
Nicky86, really ? Do you really believe that, or is it something else that you've heard down the pub ? Any evidence to back up your wild observations ?
You may not accept this, but most Insurers actually make a loss on the Motor Policies they underwrite - it's only what they do with those premiums by way of investments that actually earns them a profit - though profit in the Motor market has been hard to come by for the past 10 to 15 years.
I don't buy that argument at all. Their investments would have to be outperforming the market so much to provide a return on investment ahead of the loss leaders that you have to question why would they continue to loose money for FIFTEEN years on a loss leader when they could just sit back and reap the additional cash off the investments no longer funding losses. I know no other business that would accept consistent losses like that.You may not accept this, but most Insurers actually make a loss on the Motor Policies they underwrite - it's only what they do with those premiums by way of investments that actually earns them a profit - though profit in the Motor market has been hard to come by for the past 10 to 15 years.
You really do have to wonder what has changed. 25 years ago I bought my first car, a 2.0 Capri. It cost me 4 weeks wages as a student engineer, and TPFT insurance also cost 4 weeks wages. My daughters can't get insurance on the equivalent car these days and insurance on a 1l snot box is at least 10 if not 20 weeks wages for them. As another example, putting me on my dad's car, a cortina, as a learner cost him £20. Putting my daughter on my mondeo, so same car essentially, cost £1200
The risk profiles the insurers face from young drivers haven't changed; if anything vehicles are safer, you only need to look at the stability of the Killed & Serious Injured statistics to see this. So why are premiums going up so so much?
And if it is no win no fee compo claims, why aren't insurers fighting claims more?
thebigmacmoomin said:
Car insurance is weird sometimes.
I insured my 2004 M3 Coupe with AXA but when I bought my 2010 Focus ST-3, they wouldnt insure me.
Thought that was odd as the M3 is more desireable to steal, more powerful, higher insurance rating, & a lot dearer to repair.
and kills fewer people than the Focus ST.I insured my 2004 M3 Coupe with AXA but when I bought my 2010 Focus ST-3, they wouldnt insure me.
Thought that was odd as the M3 is more desireable to steal, more powerful, higher insurance rating, & a lot dearer to repair.
I'd wager that it was because the Focus ST seemed to attract a lot of buyers of a certain ilk when they came out and thus were given a higher risk profile. A lot more Cat C/D Focus ST's available for sale than the M3's and I'd imagine it was because the M3 historically (probably less now that they're cheaper) attracted more mature buyers whereas the ST was more of a young lad's car on finance taking a first step up from a 1.4 Fiesta...
(and 
)Fight these claims, how ? Insurers are presented with a medical report from an eminent Consultant Orthopaedic Surgeon which confirms a 6/12/18 month whiplash (take your pick).
The Civil Procedure Rules - which govern such PI claims - dictates you cannot instruct an Expert of your own choosing so you're essentially left to defend yourself against a Litigant with (supposedly) independent medical evidence which if presented at Trial, would see the Claimant home and dry. The fact that said Surgeon churns out 10 reports a day at £400 a pop is irrelevant in the Courts eyes, as is the fact that cars have never been safer and that other countries within the EU even refuse to recognise that the medical condition called whiplash can actually exist at the relatively low speeds such injuries actually occur.
So I ask you again, how do you fight something where the rules are so stacked against you ?
Sadly, in the past 10 to 15 years we have become a Society where it is not only expected that you will claim if your car is hit, but that it's "fair game" to exaggerate your symptoms so that a 2 to 3 day dull ache suddenly morphs into a debilitating injury requiring 24 hour round the clock care in a specially adapted £500,000 house.
The Civil Procedure Rules - which govern such PI claims - dictates you cannot instruct an Expert of your own choosing so you're essentially left to defend yourself against a Litigant with (supposedly) independent medical evidence which if presented at Trial, would see the Claimant home and dry. The fact that said Surgeon churns out 10 reports a day at £400 a pop is irrelevant in the Courts eyes, as is the fact that cars have never been safer and that other countries within the EU even refuse to recognise that the medical condition called whiplash can actually exist at the relatively low speeds such injuries actually occur.
So I ask you again, how do you fight something where the rules are so stacked against you ?
Sadly, in the past 10 to 15 years we have become a Society where it is not only expected that you will claim if your car is hit, but that it's "fair game" to exaggerate your symptoms so that a 2 to 3 day dull ache suddenly morphs into a debilitating injury requiring 24 hour round the clock care in a specially adapted £500,000 house.
Car insurance is excessive nowadays thanks to a motoring underclass who see it is a secondary income, latest scam is not just getting car written off and buying back but claiming repair damage costs and injuries in lieu of insurance write off but accepting major inflated repair costs and keeping car.... that is eg £4k repair costs fix up for very little leaving vehicle hpi clear for further claims or resale etc...
Also thank the advent of claims management companies who lend you a 1 series for £70 a day that costs them £200 a month and storage at £20 a day and loss of earnings etc etc
Never claimed, not even a windscreen, dealt with plenty of insurance assessors as a garage, they can tell a story or two!!!
Also thank the advent of claims management companies who lend you a 1 series for £70 a day that costs them £200 a month and storage at £20 a day and loss of earnings etc etc
Never claimed, not even a windscreen, dealt with plenty of insurance assessors as a garage, they can tell a story or two!!!
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