I see why people don't insure their cars now

I see why people don't insure their cars now

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Discussion

donkmeister

7,996 posts

99 months

Tuesday 9th July 2019
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I paid £350ish for me + partner on my E500 last year, it went up to £450 this year due entirely to my OH clipping a wing mirror (ie a small female accident, not a proper manly one involving barrel rolling through a hedgerow at 90mph).

Your job can also affect things - we sort out administration like insurance for my FIL, putting us both (boring office jockeys) on his insurance brings it right down, but putting my SIL on (gym instructor, and they're notorious for party-hard lifestyles and are often driving in the early morning/late night hours) drives it up massively.

Terminator X

14,921 posts

203 months

Tuesday 9th July 2019
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When the fine for having no insurance is less than the cost of having it you can see why some folk don't bother.

TX.

Terminator X

14,921 posts

203 months

Tuesday 9th July 2019
quotequote all
Ed/L152 said:
I'm amazed that insurance is so cheap, considering the huge costs of repairs these days for even quite minor damage.
Most people don't have any / many accidents though? My last one was 20 years ago and I've been paying north of £500 every year.

TX.

Monkeylegend

26,226 posts

230 months

Tuesday 9th July 2019
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Terminator X said:
When the fine for having no insurance is less than the cost of having it you can see why some folk don't bother.

TX.
Are there no other costs associated with being caught and fined for no insurance ?

Snails

915 posts

165 months

Tuesday 9th July 2019
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A lot of people aren't aware of it at all, but the Ogden rate has had an impact in the last couple of years, as it can have a very significant impact on claim settlements.

"When assessing lump sum awards for personal injury claimants, courts take into account the net rate of return (discount) that the claimant might expect to receive from a reasonably prudent investment of lump sum compensation. Since 2001, this rate has been 2.5%.

On the 7th December 2016, It was announced that a review of the Discount Rate would be undertaken and the decision was reached to reduce the discount rate by 3.25 points to -0.75%, with effect from 20th March 2017. This rate change applies retrospectively to all current claims, therefore current reserves may be reviewed and amended, as well as new claims.

This change will have ‘profound financial consequences’ and insurers will incur significant additional costs with classes such as Motor and Liability particularly affected, along with any class of insurance where there is an exposure to personal injury.

For example:

Based on the Ogden rate of 2.5%, a 21 year old male who has been injured and is looking at a future of nursing care and loss of earnings totalling £9,072,028, with the new rate of -0.75% the nursing care and loss of earnings increases to £20,023,103. As you can see from this example, the change in the Ogden discount rate from +2.5% to -0.75% reflects a significant increase in the total settlement of a claim."

As you could expect, this large increase in claim reserves and ultimately settlements is passed on through increased premiums.

A review of the rate is currently underway and a new rate is due to be announced before 5th August.


caziques

2,567 posts

167 months

Tuesday 9th July 2019
quotequote all
Bit drastic, but consider moving to New Zealand - where insurance isn't compulsory.

All personal injuries are automatically covered by the Accident Compensation Corporation, hence insurance only covers hardware.

I generally don't bother these days.

Countdown

39,688 posts

195 months

Tuesday 9th July 2019
quotequote all
caziques said:
Bit drastic, but consider moving to New Zealand - where insurance isn't compulsory.

All personal injuries are automatically covered by the Accident Compensation Corporation, hence insurance only covers hardware.

I generally don't bother these days.
Doesn't that basically mean that compensation claims are paid out of general taxation, regardless of a person's driving experience/history or even whether or not they drive?

S11Steve

6,374 posts

183 months

Tuesday 9th July 2019
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Still, at least you aren't a 17 year od lad.
Cheapest quote was £3800 on a 9 year old VW Polo, with black box and 5000 mile a year limit

I think he's gone off the idea of a car.

julian64

14,317 posts

253 months

Tuesday 9th July 2019
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Yep you see the threads on PH all the time.

If a person thinks they are a victim in an accident they don't try and mitigate costs, they do the complete opposite

Push for best hire car. Involve costly middle men called accident management companies. Ready to claim for any out of pocket expenses or any injury. Want any rise in their insurances costs paid for by whomever hit them.

.
.
They can't seem to put two and two together, and never seem to wonder where all the money comes from..

dapprman

2,309 posts

266 months

Tuesday 9th July 2019
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The shock I got last year was when swapping from a Citroen C6 to a Lexus GS - I was surprised at a couple of hundred increase in the premium for what should be considered a more reliable car with better availability of parts. The insurer had to point out to me the new car was worth considerably more than the older one (about £15k) - woops - reality is also that last year insurance premiums rose for the first time in a while (4 or 5 years ?).

On performance cars - back when I still had my RX7 and my MX5 they were my cheapest cars to insure - I'm certain it was due to the specialist insurance needed for highly modified cars - the actuaries must assume that as you've spent time and money and preparing the car you're probably going to take more care of them (both also had track day cover included).

wilksy61

377 posts

115 months

Tuesday 9th July 2019
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I had a Hyundai i40 Blue Estate (diesel) and changed it for a Mustang, insurance was £283 for the Hyundai and £403 for the Mustang, so based on that i would say that your premium does look at little high.

MrBen1

489 posts

117 months

Tuesday 9th July 2019
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Terminator X said:
When the fine for having no insurance is less than the cost of having it you can see why some folk don't bother.

TX.
Indeed. Of course the risks of driving uninsured are not only getting fined - the accident you cause which leaves other parties with life changing injuries is where the real risk is. However, on top of the 'it won't happen to me' mindset, I suspect there is likely correlation between assets owned and taking risks such as driving without insurance.

In other words - I don't drive uninsured because, on top of the illegality, I don't want to lose my house/cars etc because I just put somebody in a wheelchair. If you have little to lose, you have less to protect.

rossub

4,400 posts

189 months

Tuesday 9th July 2019
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TG105 said:
£500 is £10 a week. You’d spend that on one meal, a few beers etc. Think of what the insurance covers you for, aside from the illegality. It not really that bad, is it?
Things really have gone to st in this country when people are breaking insurance down into a weekly cost. It was bad enough at monthly.

J4CKO

41,283 posts

199 months

Tuesday 9th July 2019
quotequote all
Yeah, if a minor bump was costed out sensibly, would premiums be so high, trouble is everyone wants a little piece of the action and what should cost a couple of grand turns into ten times that.

Every bump turns into a quest not for the damage to be made good, but to get compensated, regardless of no actual injury the inevitable whiplash claim goes in, my mates missus had a very minor bump involving the huge damage of her towing eye cover popping off and the other party wants her pay out.

I can see why, a lot of people live hand to mouth and it could pay off the credit card, take them on holiday or buy a new telly but it is a bit cynical, same as when folk claim against businesses for an injury because things weren't absolutely idiot proof, then things get nailed down and then you will hear "Its health and safety gorn mad I tell ya"

I had a bump in a company car last year, not my fault as someone decided to do an impromptu U turn on a dual carriageway in front of me, it would have been so easy to claim (money had already been allocated to me apparently the company dealing with it said, but aside from a sore hand for a few hours there was no actual injury) but prime real estate on the moral high ground is worth more than a couple of grand to me biggrin

Countdown

39,688 posts

195 months

Tuesday 9th July 2019
quotequote all
MrBen1 said:
In other words - I don't drive uninsured because, on top of the illegality, I don't want to lose my house/cars etc because I just put somebody in a wheelchair. If you have little to lose, you have less to protect.
Indeed - whereas if you're a scrote on benefits you'll end up paying 25p a week.

Perhaps if the Courts started crushing uninsured cars/drivers that might discourage gaming of the system?

donkmeister

7,996 posts

99 months

Tuesday 9th July 2019
quotequote all
Countdown said:
caziques said:
Bit drastic, but consider moving to New Zealand - where insurance isn't compulsory.

All personal injuries are automatically covered by the Accident Compensation Corporation, hence insurance only covers hardware.

I generally don't bother these days.
Doesn't that basically mean that compensation claims are paid out of general taxation, regardless of a person's driving experience/history or even whether or not they drive?
Some years ago I recall a kiwi friend of my parents explaining this system; the cost of basic third party insurance is added on to the cost of fuel, so only road users are paying in, and proportionately to the distance they drive, size of vehicle and how much they hoon (broadly).
Basically it was a result of too many shirkers not paying their way, but really a good idea for the majority of drivers as comprehensive insurance costs go down and fewer people hit and run.
I think road fund is built in too...

zarjaz1991

3,471 posts

122 months

Tuesday 9th July 2019
quotequote all
Countdown said:
Indeed - whereas if you're a scrote on benefits you'll end up paying 25p a week.

Perhaps if the Courts started crushing uninsured cars/drivers that might discourage gaming of the system?
When the police started seizing uninsured cars we were told that if no insurance policy was subsequently produced they'd be crushed or, if worth something, sold with the proceeds going to the state.

This doesn't happen seem to happen though.

Pit Pony

8,265 posts

120 months

Tuesday 9th July 2019
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Daughter is about to move from Toxteth to Manchester Piccadilly

I wonder if up or down goes the risk? She'll be getting the tram to work.

swagmeister

382 posts

91 months

Tuesday 9th July 2019
quotequote all
julian64 said:
Yep you see the threads on PH all the time.

If a person thinks they are a victim in an accident they don't try and mitigate costs, they do the complete opposite

Push for best hire car. Involve costly middle men called accident management companies. Ready to claim for any out of pocket expenses or any injury. Want any rise in their insurances costs paid for by whomever hit them.

.
.
They can't seem to put two and two together, and never seem to wonder where all the money comes from..
THIS . . . NAIL , HEAD

dreamcracker

3,212 posts

216 months

Tuesday 9th July 2019
quotequote all
Pig benis said:
I refuse to pay £500+ for insurance on a diesel, especially as last year it cost me only £342.

Thanks folks
PB
Buy a cheaper and slower car then.
Problem solved.