Are young people been conditioned for life long rip off in..
Discussion
As an opposing argument to the 'insurance companies are ripping us off and making massive profits' argument, has anyone considered the more plausible, and arguably easier to 'fix' issue with UK insurance, which is; the whole industry is a massive inefficient mess, there seems to be no standardisation, everyone and their dog is sticking their hand in the pot for payouts, the rates that they are spending money is entirely outlandish for the average punter. All of this is evident to anyone who has been involved in a claim and has actually read the small print, the car rentals, the garage rates, the part prices, or has indeed worked in or around the industry. The costs all MASSIVELY inflated wherever insurance claims is involved. The whole industry is shafting itself which is why it's so expensive for the end user.
My solution to that would either be legislative changes, demanding more regulation of the industry with more standardised pricing across the board, in an attempt to drive down operating costs for the insurance companies down, and thus (hopefully) the end user.
Or, from a business standpoint I think that there could be savings made running a small 'local' company, using independent, lower cost, garages and part suppliers, however the ability for these companies to operate is hampered by the colossal legal clout which the larger companies utilise.
It's a complicated issue, whilst I disagree with the sentiment that insurance co's are ripping everyone off I think that the industry needs serious restructuring if it intends to be sustainable.
My solution to that would either be legislative changes, demanding more regulation of the industry with more standardised pricing across the board, in an attempt to drive down operating costs for the insurance companies down, and thus (hopefully) the end user.
Or, from a business standpoint I think that there could be savings made running a small 'local' company, using independent, lower cost, garages and part suppliers, however the ability for these companies to operate is hampered by the colossal legal clout which the larger companies utilise.
It's a complicated issue, whilst I disagree with the sentiment that insurance co's are ripping everyone off I think that the industry needs serious restructuring if it intends to be sustainable.
caelite said:
My solution to that would either be legislative changes, demanding more regulation of the industry
One of the reasons insurance is expensive is the massive cost of meeting existing regulation. Insurance is probably the most over regulated business in Britain. If you work in insurance, you can hardly go for a p1ss without registering it. CPD points, TCF, FCA regs, solvency regs, etc. etc. It's madness. Benjijames28 said:
Triumph Man said:
I'm 26 now, started driving at 17, and currently drive a BMW 530i E39, and a 520i E34. Insurance isn't too bad (the 530i is £450ish a year (fully comp), and the 520i is £200 ish on a classic policy). I do however live in a very good postcode - insurance wise!
OP I don't know if it's your relative lack of experience or where you live? I wouldn't have thought a 2 litre diesel would normally be that much!
I've looked and its actually cheaper for me to insure a 535i manual 2010 model. Then it is for me to insure my 2 litre diesel.OP I don't know if it's your relative lack of experience or where you live? I wouldn't have thought a 2 litre diesel would normally be that much!
Work that one out.
TwigtheWonderkid said:
caelite said:
My solution to that would either be legislative changes, demanding more regulation of the industry
One of the reasons insurance is expensive is the massive cost of meeting existing regulation. Insurance is probably the most over regulated business in Britain. If you work in insurance, you can hardly go for a p1ss without registering it. CPD points, TCF, FCA regs, solvency regs, etc. etc. It's madness. Why does renting a small hatchback from a claims management company cost £500/day?
Why do insurance body shops demand an hourly rate 3 or 4 times the industry standard?
Why does one claim require half a dozen different companies, with their expenses and management structure dipping their hands into the money pot inflating the claim?
In my eyes the whole industry has just turned into a opportunists wet dream. A necessary public service should not be run in that manner.
Gad-Westy said:
There seems to be a prevailing notion that the insurance industry is one 'entity'. I guess that might come from the fact that -unlike just about everything else- there is a legal requirement to have vehicle insurance, if you use a vehicle on the public road at least. So it feels like a public service, a monopoly or whatever you want to call it but the reality is that it's 100's of private companies competing for your £'s.
That is why the idea of some sort of cartel/industry agreement seems so far fetched to me. I somehow cannot imagine that Churchill the dog and the Admiral are having hushed conversations in a quiet corner of the masonic lodge to agrees all this. Maybe it was more feasible prior to the days of price comparison sites where people weren't shopping around so much but these days, when 100's of insurers lay their prices out in front of you with a few clicks of the mouse? Seems like tin foil hat stuff to me.
The insurance companies are quite co-operative with each other. Look at the MIB for an example.That is why the idea of some sort of cartel/industry agreement seems so far fetched to me. I somehow cannot imagine that Churchill the dog and the Admiral are having hushed conversations in a quiet corner of the masonic lodge to agrees all this. Maybe it was more feasible prior to the days of price comparison sites where people weren't shopping around so much but these days, when 100's of insurers lay their prices out in front of you with a few clicks of the mouse? Seems like tin foil hat stuff to me.
caelite said:
3rd parties, dealing with 4th parties, dealing with 18th parties, with major inefficiencies being added by middle men at every step.
For clarity, insurance is a contract between 2 parties, the policyholder and the insurer. Anyone else who comes into play is a 3rd party. There is no 4th party, or 18th party There can however be more that one 3rd party. TwigtheWonderkid said:
Probably the biggest load of cobblers I've read on here, and wow, there's plenty of competition.
How do you asses level of risk, if not by age, location, car type etc? What do you suggest, star sign and fave breakfast cereal.
Do you seriously not realise that teenagers are a higher risk than middle aged people, that a Nissan GTR is a higher risk than a Nissan Micra, or that living in Central Liverpool is a higher risk than the Shetlands.
Are you on mindbending drugs?
Also I think the GTR is safer, i'd rather be overtaking a truck in that, than in a Nissan Micra/Juke.
If you think a faster car is automatically dangerous, then your on the wrong forums.... Might I suggest Mumsnet??
When I was 25 (2000) I had a 2.6E Audi Cabriolet - in an HP2 postcode and was paying £550 per year fully comprehensive.
It was garaged, had a tracker and a clifford blackjack alarm/anti carjack system.
I minimised my risk so thats probably why it was comparatively cheap.
BTW £550 in 2000 is the same as £647 now!
It was garaged, had a tracker and a clifford blackjack alarm/anti carjack system.
I minimised my risk so thats probably why it was comparatively cheap.
BTW £550 in 2000 is the same as £647 now!
TwigtheWonderkid said:
j4ck100 said:
kambites said:
Insurance premiums aren't really meant to be based on logic, they're based on statistical analysis. The insurance companies neither know nor probably care why the statistics are accurate; just that they are.
There's an enormous amount of money to be made from even tiny improvements in the statistical models but it's far easier to improve them by data-mining than by trying to apply logic.
This man gets it. I work in the data field, and I can tell you that as of now, approximately 6 major UK car insurers are using your postcode level internet shopping data to assist in working out your pricing. You have no idea the amount of data that goes in to calculating a premium now a days.There's an enormous amount of money to be made from even tiny improvements in the statistical models but it's far easier to improve them by data-mining than by trying to apply logic.
That's why people saying "how come a BMW 540 is cheaper to cover than a 520" are barking up the wrong tree.
TwigtheWonderkid said:
caelite said:
3rd parties, dealing with 4th parties, dealing with 18th parties, with major inefficiencies being added by middle men at every step.
For clarity, insurance is a contract between 2 parties, the policyholder and the insurer. Anyone else who comes into play is a 3rd party. There is no 4th party, or 18th party There can however be more that one 3rd party. No real effort seems to be made to cut down on internal efficiencies, or to chase down the corruption within the industry, everyone just seems all too willing to hand the costs over to the end user and in my eyes the current regulations make it all too easy for them to do so.
j4ck100 said:
This man gets it. I work in the data field, and I can tell you that as of now, approximately 6 major UK car insurers are using your postcode level internet shopping data to assist in working out your pricing. You have no idea the amount of data that goes in to calculating a premium now a days.
How do insurers access internet shopping data?Join a club. Many of these get a handy discount from particular insurers. I had an Unusual* car at one time, my regular insurer would not cover these. Joined the Unusual Car Club, no problem getting cover, guess who from? Yes, my very own insurer who ran the club cover scheme.
*Insert your own favourite silly car.
*Insert your own favourite silly car.
caelite said:
It's a complicated issue, whilst I disagree with the sentiment that insurance co's are ripping everyone off I think that the industry needs serious restructuring if it intends to be sustainable.
They're actually ripping eachother off, but it's us who has to pay for it.Repair costs via insurance are double/triple what they should be, what about courtesy cars being charged at £200 a day and then claims being dragged out for months on end?
Work colleague had a very minor accident (scratched bumper), had a courtesy car for 6 weeks, it was admitted that the car was costing £180 a day, that's £7500 being charged to the other ins company JUST for the courtesy car. But they're all doing it to each other, the one that takes a more honourable stance would simply end up out of business.
The industry needs a good kick up the backside and a mutual agreement to stop them fleecing each other and eventually us.
caelite said:
Maybe more regulation wouldn't be correct then, potentially 'different' regulation, cutting back in some areas, but demanding restructuring in others. I really am not an expert on the internal workings of the companies, however I have experience working in a bodyshop and insurance lockup and from the outside looking in the way the industry operates is a shambles. Backhanders everywhere, silly monetary funds being moved between operators, 3rd parties, dealing with 4th parties, dealing with 18th parties, with major inefficiencies being added by middle men at every step.
Why does renting a small hatchback from a claims management company cost £500/day?
Why do insurance body shops demand an hourly rate 3 or 4 times the industry standard?
Why does one claim require half a dozen different companies, with their expenses and management structure dipping their hands into the money pot inflating the claim?
In my eyes the whole industry has just turned into a opportunists wet dream. A necessary public service should not be run in that manner.
Quite so - but many bodyshops and rental and claims management companies making a killing off that so..........Why does renting a small hatchback from a claims management company cost £500/day?
Why do insurance body shops demand an hourly rate 3 or 4 times the industry standard?
Why does one claim require half a dozen different companies, with their expenses and management structure dipping their hands into the money pot inflating the claim?
In my eyes the whole industry has just turned into a opportunists wet dream. A necessary public service should not be run in that manner.
bad company said:
j4ck100 said:
This man gets it. I work in the data field, and I can tell you that as of now, approximately 6 major UK car insurers are using your postcode level internet shopping data to assist in working out your pricing. You have no idea the amount of data that goes in to calculating a premium now a days.
How do insurers access internet shopping data?lyonspride said:
TwigtheWonderkid said:
Probably the biggest load of cobblers I've read on here, and wow, there's plenty of competition.
How do you asses level of risk, if not by age, location, car type etc? What do you suggest, star sign and fave breakfast cereal.
Do you seriously not realise that teenagers are a higher risk than middle aged people, that a Nissan GTR is a higher risk than a Nissan Micra, or that living in Central Liverpool is a higher risk than the Shetlands.
Are you on mindbending drugs?
Also I think the GTR is safer, i'd rather be overtaking a truck in that, than in a Nissan Micra/Juke.
If you think a faster car is automatically dangerous, then your on the wrong forums.... Might I suggest Mumsnet??
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