The insurance industry has saved millions but prices are still rising
Confused.com says there has been a rise of 20 per cent in second quarter
‘The insurance industry promised to reduce premiums if claims fell’
Insurance companies are cashing in whilst motorists are paying out more.
Despite measures that have helped the industry to save half a billion pounds in the past three years, motorists are still being overcharged and thanks to a government crackdown are making less claims.
New figures released by The Times show that personal injury cases have fallen by 23,000 under the reforms, in a move that has saved insurers almost £520 million.
In addition, premiums have jumped by as much as a fifth in the past 12 months alone, adding around £115 to bills, even though a government crackdown on the no-win, no-fee industry has led to a drop in whiplash claims.
Whilst insurance companies cash in on a reduction in injury claims other research shows an increase in the costs motorists are still having to pay
Louise Ellman, chairwoman of the Commons transport select committee told The Times: ‘The bottom line is that the insurance industry promised that they would reduce premiums as whiplash claims fell, and if they haven’t done it, they’ve reneged on their promise.
‘Fraud must be wiped out but the insurance industry must also honour its promises.’
A confused.com study which used information from prices quotes to motorists found that the average policy stood at £715 on average for a comprehensive car insurance premium, compared to £600 this time last year.
This was a rise of nearly 20 per cent in the second quarter of this year compared with the same period last year.
In July Amanda Stretton, motoring editor at Confused.com, said: ‘We’ve not seen price rises of this magnitude for five years – a 19 per cent annual increase is substantial to say the least.
‘And these price rises are being felt across the board, for drivers of all ages and genders, across all UK regions.
Insurers are believed to have saved more than £500 million after a government crackdown on the no-win, no-fee whiplash claims
‘If prices continue to rise at the rate we’ve been seeing, we could be facing the possibility of average comprehensive premiums breaching the all-time high seen in 2011, when they peaked at £858.
‘This, combined with rising fuel prices and increased motoring costs across the board, could result in a sizeable dent in drivers’ pockets.’