Confused.com is backing the findings of the Transport Select Committee's report into the rising cost of motor insurance and is supporting the Committee's calls for a full government consultation on planned changes and a timetable for implementation.
The car insurance comparison website, which provided evidence to the inquiry in November, has itself previously called for issues of fraud, raised penalties for uninsured drivers, better education and support for young drivers and better data sharing to be implemented in order to help tackle the root cause of insurance premium rises.
Gareth Kloet, head of car insurance at Confused.com, said: "During 2010 the average fully comprehensive car insurance premium rose by 38.2%*, and now stands at £695. Unless measures are taken premiums will continue to rise and more motorists may be tempted drive uninsured, underinsured or make fraudulent claims in an attempt to save money, which will only serve to increase premiums further.
"We fully support the idea of having a dedicated police unit that will help tackle insurance fraud, one of the major causes of the sharp rise in premiums. Cash for crash schemes are not only dangerous but cost honest motorists as they ultimately foot the bill for these 'accidents'. Confused.com firmly believes that improving data sharing between the DVLA and insurers will also help reduce instances of fraud.
"In addition to increasing transparency around referral fees and payments in the event of a claim, we would also argue that a structure for compensation claims and a set limit on legal fees be implemented, as per the Lord Jackson review."
On the issue of young drivers, Confused believes a number of actions are essential. 15% of young drivers currently cause 31% of all accidents. These accidents lead to 40% of all motor insurance claims, so implementing measures to reduce fatalities and serious injuries amongst this group is essential.
Confused believes this is especially important given the recent EU gender ruling which will see young women's premiums rise to the same level as young men's. Making the driving test harder, re-assessing the pass plus scheme or getting insurers to offer discounts for those who have had additional training and increasing the use of telematics devices should all be investigated. At present the penalty for being caught driving uninsured is a maximum £1,000 with an actual average fine of £200. Given that the average premium for a male aged 17-20 is currently £2,976* and for women in the same age group £1,694* the incentive to gamble is too high and must be addressed.
Gareth continued: "We join the calls made by the select committee for action to be taken, starting with a full consultation and timetable for change. It's high time we started tackling the root causes instead of talking about the implications."
Confused.com is one of the UK's biggest and most popular price comparison services. Launched in 2002, it generates over one million quotes per month. It has expanded its range of comparison products over the last couple of years to include home insurance, travel insurance, pet insurance, van insurance, motorbike insurance, breakdown cover and energy, as well as financial services products including credit cards, loans, mortgages and life insurance.
Confused.com is not a supplier, insurance company or broker. It provides a free, objective and unbiased comparison service. By using cutting-edge technology, it has developed a series of intelligent web-based solutions that evaluate a number of risk factors to help customers with their decision-making, subsequently finding them great deals on a wide-range of insurance products, financial services, utilities and more. Confused.com's service is based on the most up-to-date information provided by UK suppliers and industry regulators.
Notes to Editors:
*Based on Confused.com/Towers Watson index.
Previous news release and full Confused.com submission to Transport select Committee inquiry available on request.
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