Slowdown in insurance price increases

Over the past year many drivers in the UK have been hit hard by the rising cost of petrol, and to add to their misery huge increases in vehicle insurance have also been put into place as motor insurance firms struggle to recoup losses resulting from increased claims and investment losses. This has made it increasingly difficult for drivers to keep their vehicles on the road.

However, it has been reported recently that whilst the cost of vehicle insurance is still on the up the price increases have started to slow down, which will come as a relief to many drivers who are due to renew their policies and have been concerned about how much more this will cost.

In the third quarter of this year the cost of insurance is said to have increased by 8.6 percent, taking the average cost of comprehensive cover to £650. The increase during the previous quarter came to 14.2 percent, which was much higher than the increase for the three months to the end of September. However, whilst the increase in the cost of cover has slowed down the average cost of cover is still around 37.5 percent higher than a year ago, with the increase for younger drivers taking out third party, fire, and theft cover coming in at over 54 percent.

One official involved in the research into price increases on motor insurance stated: “The price corrections that have been taking place over the past year or so have been essential to getting many private motor insurers back on an even keel after poor 2009 results. However, the level of increases is starting to slow down, with each month in the quarter showing flatter price rises than the previous one.”

Tags: Insurance, previous quarter, price, Vehicle insurance, struggle

Recession causes insurance fraud to soar

According to a recent report the level of insurance fraud has been rocketing as a result of the bleak financial climate and the recession. A report was recently released by the Association of British Insurers, and officials from the ABI have said that in 2008 the number of attempts to defraud insurance companies increased by 17 percent compared to 2007. Read more

Tags: premiums, insurance cheats, Association of British Insurers, road, insurance claims

Curb to charges could mean increase in bank fees

Britain could see an end to free banking in the near future depending on what happens with the banks charges case, and whether the fees that banks are allowed to charge for overdraft fees and charges can be curbed. If the charges are cut then banks and other financial institutions may decide that they are going to try and recoup the costs by imposing hefty service fees and charges elsewhere. Read more

Tags: housing, increase, road, british bankers association, Banking, twenty years, savings

Try before you buy housing could prove effective

A recent report has shown how some housing developers are now trialling a scheme where a potential property buyer can try out the property that they are thinking of buying for a day or two before they make a decision or commitment. With house sales falling as a result of right credit conditions, falling house prices, and the global credit crunch, those that are able to purchase often need more persuasion and it seems that this try before you buy method could help developers to increase sales and buyers to enjoy increased peace of mind when it comes to making a purchase. Read more

Tags: day, Business and Economy, road, households, inflation uk economy, age bracket, potential buyers, older age

Rising inflation targets young and old

Inflation is rising, and it is hitting the oldest and the youngest hardest.

In October, inflation rose above the predicted rate of 2.1 per cent – itself above the Bank of England’s 2.0 per cent target – but for over-75s and under-30s, the figure was even higher, at 2.5 per cent.

The breakdown of the impact of inflation on different age groups has been carried out by the Alliance Trust Research Centre.

Younger people have been hit by above-average increases in the price of food, rent and education, while older people have been especially vulnerable to changes in the cost of food, which constitutes a high proportion of their outgoings.

Although energy costs have dropped in recent months, this has been outweighed by rising prices in other areas.

Inflation in food prices this year stands at 5 per cent, while road fuel prices are rising by 12 per cent.

Shona Dobbie, head of the Alliance Trust Research Centre, said: “Throughout the course of our study, which started in 2003, the elderly have consistently suffered the highest levels of inflation. Now they are being matched by the young.

“More than four years of higher-than-average inflation has been eating into pensioners’ budgets and it looks like this situation is going to continue for some time. We are also concerned about the more recent trend of young adults also facing inflation which is significantly higher than the headline rate, largely due to higher rents and education costs, as well as the costs of basic goods.”

Tags: Business Finance, fuel prices, above-average increases, road, inflation targets, fuel, headline rate, figure

Drivers affected by insurance company blunder

A payment blunder made by a popular vehicle insurance company has resulted in many drivers being stranded without insurance cover and having their insurance policies cancelled.

The blunder was made by Hastings Direct, and due to a mistake that the company made with regards to its charges and premiums over 2500 drivers were left with no insurance cover after their policies were cancelled by the insurance giant.

The drivers that have been affected by the problem were contacted in writing recently by the insurance company. The payment error that was the fault of the insurance company meant that the consumers in question had been paying too little for their cover. Policyholders are being offered refunds on a pro rata basis following the blunder, and the insurance company claims that it has kept the Financial Services Authority up to date on what is going on.

In a letter that was sent to the affected policyholders Hastings Direct stated: ‘You have seven days from the date of this letter in which to make alternative insurance arrangements. No cover under the existing policy will be in force after this period and no further notice of cancellation will be issued. May we take this opportunity to remind you that it is an offence under the Road Traffic Act to keep a motor vehicle on the public highway without valid insurance cover being in force.’

This has left customers of the insurance company angry and upset, and with the problem arising in the peak of the summer it is thought that many could be away on holiday and therefore not even realize that they are no longer insured.

Tom Smith
29th September 2007

Tags: drivers, blunder, policy, cancelled, hastings, car, road, Insurance, act, traffic