VAN INSURANCE NEWS ROUNDUP: 7 DAYS ENDING 22 AUG 2014:

One major car insurance provider recently rained on everyone’s parade recently, remarking that the good times are nearly over when it comes to cheaper rates.

Industry juggernaut Admiral, infamous for cornering the market for car and van insurance, said recently that despite the fact that insurance rates have reached amazing lows lately the party could be over before we know it. Whilst a more conspiratorially-minded individual might interpret this as a threat that Admiral is going to choose to increase their rates, I don’t think this is the case – I simply think that the insurance giant is remarking that the industry in general is likely to have no choice but to raise rates in order to remain profitable.

Yes, there may be stories of other car and commercial van insurance providers such as Direct Line turning a profit even as rates decline, but in instances like this their steady income growth is more due to cutting their costs by a wide margin than anything else. And let’s be honest here – rates are almost ludicrously low on average. In fact a new press release from the British Insurance Brokers’ Association claims that there’s been an overall 5.6 per cent drop in insurance pricing – or if you take inflation into account, an even 7 per cent drop. This is of course a fantastic bit of news, considering we haven’t seen rates like this for vehicle insurance since 2010 or so, but unfortunately the news is overshadowed by Admiral’s dire portents.

So what’s a responsible vehicle owner to do? Well there’s not much to do, honestly, except ensure that you lock in your premium pricing for the year as soon as possible. If you ask me, if you don’t shop around when your renewal comes up this year you’re going to be sorely disappointed a year from now when your rates go up by an eye-watering margin and you find out you missed out on some significant savings. This could be your last chance for many insurance cycles to come, so don’t do something – or fail to do something – you’re gong to regret later on. It’s expensive enough to keep a vehicle on the road as it is without having to pay through the nose for insurance as well!

VAN INSURANCE NEWS ROUNDUP: 7 DAYS ENDING 15 AUGUST 2014:

So here’s one thing I just don’t understand: car and van insurance companies are reporting tidy profits even as premium prices plummet, sometimes severely.

Maybe I’m just naive but I always used to thinking about reality in a certain way. For example, if a car insurance company reports profits are going up, I’d expect to think that their premium pricing has crept higher as well, yet somehow that’s actually not the case right now. I know it seems backwards – and let’s be honest, it is – yet the news this week was filled with interesting tidbits of information revealing just these jumbled facts.

First of all, Direct Line Insurance just announced that its six month profit hit a tidy sum. How tidy you may ask? Well how does £225.1 million sound to you? I know it sounds fantastic to me. Now for what it’s worth Direct Line doesn’t just do motor and commercial van insurance but home insurance and other types of business – there’s all sorts of revenue streams the company has, and somehow all of them have been in the black.

Yet at the same time – and this is where it makes my head hurt to think about it – Direct Line also just reported that its first half premium profits have declined by nine per cent. What has happened here is that the price of an insurance policy in the UK has plummeted over the last year. In fact in some regions such as Scotland – where Direct Line actually hails from, considering that it had been spun off from Royal Bank of Scotland two years ago – prices have dropped by something like an amazing 20 per cent.

So premium prices are going down, insurers are taking in less money, yet somehow their profits are soaring? What in blue blazes is going on? Well the writing is on the wall – I’ll bet you anything that there are hundreds of insurance staff members getting sacked left and right as part of ‘corporate cost restructuring efforts’ or some other such rubbish. Fewer Brits on payroll means less money flowing out of the coffers of insurers to begin with – so they can afford to collect smaller amounts of revenue from British drivers. What a bloody mess!

VAN INSURANCE NEWS ROUNDUP: 7 DAYS ENDING 1 AUG 2014:

So car and van insurance companies are saying their rates have been dropping like mad lately, but how much can you trust these insurers in the long run, really?

Well honestly you really can’t. I know, I’m not shocking anyone with this bit of intelligence but it’s true – van and car insurance providers might be slashing their rates left and right but they’re still getting their money’s worth out of you by using underhanded means. It’s a bit of a bait and switch if you think about it, especially now that research findings have been published how a large number of insurance providers are instituting hidden fees and charges to line their pockets with the cash they’re not pulling in from their customers directly any more.

Whether you want to ring up your insurer to inform them of a change to your personal details such as getting married or you’ve decided to cancel your policy early you’re likely to be subject to fines and fees now. In fact, there are more than a few insurance providers who will charge you for the high privilege of initially taking out cover with them – or even renewing your annual cover as well. Can you bloody believe it?

Of course insurers haven’t stopped there. Beware if you decide to ring up your insurer just to ask a question about your car or commercial van insurance cover, as you could end up making your premium prices go up completely inadvertently. Let’s say hail damage dents your bonnet a bit and you ask your insurer if your excess will be more than it would cost you to repair the bonnet out of pocket; even if you end up paying for the damage yourself there’s a chance insurers will decide to hike your rates just for the enquiry.

So yes, these are not exactly the kinds of activities that will endear your customers to you. Of course insurers really don’t care about that all that much, as evidenced by their behaviour. Well, forewarned is forearmed I suppose – don’t ring up your insurer unless you’re bloody well on fire and in a ditch somewhere in the middle of the Welsh countryside. And even then, you’re going to be lucky if you don’t end up with hiked insurance rates.