Crashes on UK Roads Fall, but Cover Remains High. What Gives?

The AA has warned that the first quarter dip in insurance premiums is not unprecedented. As firms try to buy market share (or end the fiscal year on a high), policy prices drop.

But there’s something more fundamentally wrong, waiting to catch unsuspecting car and van drivers out. It’s the insurers themselves who’ll support the cost of swathes of Personal Injury claimants seeking compensation.

It’s a worrying trend. And whilst new measures are brought in to test soft tissue injuries such as whiplash, the damage may well have already been done.

Janet Connor, AA Insurance MD, is so concerned that she’s aired her views on the back of research undertaken by the insurers.

Where do motorists think the cash for payouts comes from?

The results are worrying. It’s not the statistical evidence. The actual number of incidents on the UK’s roads is dropping.

It’s the mindset drivers have adopted against the backdrop of the UK’s ‘compensation culture’ that’s the main concern.

There’s a direct correlation between the cost of cover and the amount paid out in the claims courts. Janet’s calling for drivers to visualise that link and change their attitude towards making a claim.

Whilst most van insurance may be channelled through the company, that’s no excuse to claim ‘just because you can’. The time for opportunistic payouts must end to add stability to an already fragile market.

But it will take a huge sea change in the attitude of many drivers on the UK’s roads to bring it about. One in nine drivers in the AA’s research wouldn’t blink when making a claim in no-fault accidents. Even if no one’s injured!

Insurance cover already increasing for some

The time to renew car and van insurance is now. The reductions in cover cost are coming to an end, as they often do once the surge of new vehicles has filtered into the market.

Older drivers can already vouch for the incremental cost of their policies. What the AA don’t want to see is a return to 2010/2011 rates, when policies were hiked 40% in a year.

As the Bank of England reins in its forecast for economic growth, businesses don’t need substantial rises in the cost of their fleet insurance.If the trend of crashes reducing but claims rising continues, increased costs seem inevitable.

The reduced cost of the average policy, as is the case across the country, will soon reverse. And we won’t be able to blame the insurers this time. They’re already warning us that they’re backed into a corner.

© 2021 All rights reserved. Reproduction in whole or in part without permission is prohibited. See our copyright notice.

Share your views

To leave a comment on this story, please insert your details below.