Personal injury claims, many arising from ‘crash for cash’ claims, have been cited as one of the many reason for driving up the costs of van insurance.
Although the Office of Fair Trading are looking into the rising costs of van insurance, industry experts predict that costs will rise higher, irrespective of the OFT investigation.
This outcry from the motor manufacturers and auto-insurance sector make it more imperative than ever to make sure you search online for cheap van insurance well in advance of your renewal date.
Even if you’re existing van insurance cover is not yet ready to expire, you still need to build renewal quote figures into your 2012 budget – the last thing you need when you come to cover your fleet is to find that you’ve not put enough capital aside to cover these costs.
The insurance sector have given us some insight as to why we are continually seeing our van insurance premiums inflate, year upon year, and even more dramatically in recent times.
The belief is that, in order to remain competitive and secure a large sector of the commercial vehicle insurance market, insurance companies have gone for volume to drive their profit, which has given us van insurance premiums that have not reflected the true value of the product.
The intention was, and there were a lot of big players in the market putting a ceiling on their van cover quotes, that once the individual companies were satisfied that their target market was satured, the market would rise as one.
However, with comparison sites offering even better value, and commanding a percentage of the policies in referral fees, the van insurance brokers failed to recoup the profit and found themselves having to reduce their mark-up even more if they wanted to be involved in this increasingly-popular way of attracting new business.
During 2010, when creditors were pulling in the reins and offering very little in the way of extra lending, many insurance companies serving the commercial sector were either taken over by larger concerns or disappeared from the market all together.
2011 saw the bubble burst on the back of a horrendous 2010, for the whole UK economy and commercial vehicle sector alike, and prices had to rise way above the rate of inflation, which hadn’t been filtered in for some time as van cover providers looked to remain as cheap as possible in the face of very stiff competition.
The OFT investigation is ongoing, but there have been certain pleas entered by the auto insurance committee that have been well received and justified.
If you’re planning to renew your van insurance, find the cheapest possible deal here, on cheapvaninsurance.co.uk.