Are young people been conditioned for life long rip off in..
Discussion
Just to add some facts to the insurance 'rip-off' debate, check out the Combined Ratio information on p. 3 (1/7) of this report. This ratio is defined as Claims plus Expenses over Premiums Received, and can be thought of as the profitability of the insurance company before investment income on the 'float' is taken into account. A number over 100% implies that the insurer is loss-making before investment income.
Direct Line 124%
Aviva 108%
Ageas 107%
http://uk.milliman.com/uploadedFiles/insight/2016/...
Direct Line 124%
Aviva 108%
Ageas 107%
http://uk.milliman.com/uploadedFiles/insight/2016/...
kambites said:
Out of interest, how do you know you "live in a decent post code"? Have you actually looked into the insurance risk of the area?
We genuinely live in a good post code and my wife is only a couple of years older than you... we insure an Elise and an Octavia VRS for both of us to drive for less than £400 combined. I think either yoru post-code is relatively high risk or there's something else about you that the insurers don't like (job, driving history, etc.).
When I was 30 I drove a 540 and lived in a descent post code. My quotes to insure it ranged from £2k to £6k. We genuinely live in a good post code and my wife is only a couple of years older than you... we insure an Elise and an Octavia VRS for both of us to drive for less than £400 combined. I think either yoru post-code is relatively high risk or there's something else about you that the insurers don't like (job, driving history, etc.).
Edited by kambites on Tuesday 19th September 20:56
I remember asking why it was so ludicrously high and being told it was because the post code next door was NW6 and it was riddled with people who liked stealing or vandalising 5 series BMWs. The TVr at the time was a few hundred quid and again in asking why I was told that the people who lived in NW6 didn't steal TVRs because they weren't cool and were too difficult to drive. I was certainly given the impression that the huge premium was due to the car and the area as opposed to my original belief that it was due to being. 30 year old stockbroker who statistically would be high on drugs and thrashing a car round London.
When I read the OP's quote my first reaction was that £1500 was cheap. Certainly much cheaper than 15 years ago. Especially given just how much the GPB has depreciated since then also. Ultimately, I don't think the cost of insurance is the actual problem these days as it does seem to get cheaper but it is more the issue that wages haven't grown for many so there is less income to cover these costs?
Edited by DonkeyApple on Wednesday 20th September 11:22
NickCQ said:
Just to add some facts to the insurance 'rip-off' debate, check out the Combined Ratio information on p. 3 (1/7) of this report. This ratio is defined as Claims plus Expenses over Premiums Received, and can be thought of as the profitability of the insurance company before investment income on the 'float' is taken into account. A number over 100% implies that the insurer is loss-making before investment income.
Direct Line 124%
Aviva 108%
Ageas 107%
http://uk.milliman.com/uploadedFiles/insight/2016/...
Another one bringing facts into the debate. Look we've already established that there is a massive cartel operating in the UK car insurance industry, so it follows that there is widespread accounting fraud too. This means that we don't have to believe any numbers the insurers publish, we can safely ignore your facts and, rather than try to understand how the rather complex business of insurance works, continue to blithely say that it's all a scam. Direct Line 124%
Aviva 108%
Ageas 107%
http://uk.milliman.com/uploadedFiles/insight/2016/...
MikeyMike said:
I think that's exactly what it is, you've only been driving for 5 years, presumably that puts you in the same bracket as most 22 year olds who passed at 17.
Nope, doesn't work like that. Experience is a pretty small part of the risk profile. A 50 year old who passed their test this morning will pay far less for cover on the same car in the same area than a 20 year old with 3 yrs experience. Sheepshanks said:
Gad-Westy said:
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.
Sure - but they're all looking at each others premiums though. And the reason they're doing that isn't to benefit consumers.That's not a cartel, that's capitalism.
A cartel would be if they could all sell for £10, but agree to not go below £15 to maximise profit.
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.
culpz said:
Something doesn't sound right there. That's not me saying that you're lying but there must be a reason for it.
I'm 25, 2 years NCB, 1 fault accident about 3 years ago, M postcode (one of the worst), driving for 7 years, 8k per annum, employed full-time, £900 on an Audi A4.
Is there anyone else on your insurance policy or just you? I've always insured my dad on mine as a second driver for occasional use and it's always made the premium significantly cheaper.
I've put a family member on the policy which reduced it down by about 75 quid.I'm 25, 2 years NCB, 1 fault accident about 3 years ago, M postcode (one of the worst), driving for 7 years, 8k per annum, employed full-time, £900 on an Audi A4.
Is there anyone else on your insurance policy or just you? I've always insured my dad on mine as a second driver for occasional use and it's always made the premium significantly cheaper.
Edited by culpz on Wednesday 20th September 08:26
Trust me there's nothing bad increasing my risk.
28yrs old, 5 years since I passed my test, 5 years no claims, no points.
It just doesn't make sense to me.
DonkeyApple said:
When I was 30 I drove a 540 and lived in a descent post code. My quotes to insure it ranged from £2k to £6k.
I remember asking why it was so ludicrously high and being told it was because the post code next door was NW6 and it was riddled with people who liked stealing or vandalising 5 series BMWs.
That's the thing though isn't it,you did not live in a good postcode (from an insurance point of view) because part of the definition of a good post code is not being next to a crap post code. Whilst there clear is a correlation between the affluence of an area and its insurance risk, they are far from directly proportional. I remember asking why it was so ludicrously high and being told it was because the post code next door was NW6 and it was riddled with people who liked stealing or vandalising 5 series BMWs.
Benjijames28 said:
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.
Work that one out.
Was ever thus with insurance, limited logic. Look at exactly the same car with different manufacturers badges (eg Suzuki Splash / Vauxhall Agila) and you'll see differential premiums.You just need to seek out those bargains. Work that one out.
Best peice of advice on here is add an oldie to your policy even if they never drive it (providing they're under 70). I'm 50 with 33 years driving under my belt and adding parents still makes a positive difference. Work that one out !
Edited by Speed 3 on Wednesday 20th September 11:40
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.
It isn't really about the insurance firms but the underwriting syndicates they lay off to. 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.
For bread and butter policies there will be a huge number of syndicates who want to attract what are ultimately 'free' premiums so the pricing is pretty competitive. However, the number of syndicates that want to take premiums on higher risk drivers/cars is much smaller so there is less price competition.
Bearing in mind that each insurer will only have a few syndicates they lay off to some may, at times, not have any syndicates wanting to take on a specific type of business and so this is why you need to shop around insurers in order to find the one that is working with a syndicate that wants that flow.
Speed 3 said:
Was ever thus with insurance, limited logic.
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.
Speed 3 said:
I'm 50 with 33 years driving under my belt and adding parents still makes a positive difference. Work that one out !
People aged 50 who have their parents on the policy are obviously aware of the savings to be had by adding them and this shows they are interested in saving money, so maybe more cautious by nature. Those that don't add their parents are happy to chuck money away and are less cautious individuals. I'm guessing that cautious people have less accidents. No idea if that's the real reason, but bottom line is their stats are better for 50 y/olds who add parents compared to those that don't..
Do I win a prize?
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.
Wow, someone actually gets it!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.
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.
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.
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