Fuel Card News Motoring Updates: Cost of insurance to be investigated by OFT
The cost of motor insurance is set to be investigated by the Office of Fair Trading (OFT) after it discovered that insurance premiums increased by nine percent between January and September 2011.
The investigation will focus mainly on third party, non-injury claims which involve vehicle repairs and the cost of a hire car, although 2011’s increase came on top of a 12 percent rise during 2009 and 2010, largely because of the cost associated with personal injury claims.
It has been claimed that rising premiums are pricing many drivers out of the market. Director of General Insurance at the Association of British Insurers, Nick Starling, said: “We are particularly encouraged that the OFT recognises the highly competitive nature of the market and the scale of the personal injury problem facing motor insurers – something we have been arguing needs to be rectified for years. The industry has long said that there are unnecessary costs in the system and that there are inefficiencies that need to be addressed – from personal injury to credit hire to credit repair – and we are pleased that the OFT has recognised this in its report.”
Shadow Transport Minister, John Woodcock, agreed, saying: “With average insurance premiums at an eye-watering £921, motorists need urgent action so they are not priced off the roads.”
He added that young people in particular face ‘eye-watering’ costs and that the Government had so far failed to get a grip on the problem.
In other motoring news, it has been reported that changes to the MOT test, set to be introduced from January 2012, bring a range of safety benefits to motorists but could land fleets with large repair bills if faulty equipment falls outside of the manufacturer’s warranty.
Fuel cards on www.fuelcards.co.uk give you the added benefit of HMRC-approved invoices, ensuring you reclaim 100 percent of VAT on business fuel expenses.