Car and Motorcycle insurance premiums at record highs – but personal injury claims are not to blame

Posted Nov 20, 2017.

The Association of British Insurers (ABI) have confirmed that the UK’s average motor insurance premium is now £485 per year, £45 higher than 2016 and at the highest level since the ABI started publishing its statistics in 2012. The ABI attribute the latest increase to a combination of higher average repair costs to damaged vehicles, together with the huge increase in Insurance Premium Tax (IPT - the tax the government levies on insurance policies) which has doubled in the space of 2 years.
 
However, even though personal injury claims following road traffic accidents are not cited as a factor behind rising premiums, the ABI is still supporting the government’s plans to forge ahead with significant changes to injury law, including the imposition of far lower maximum compensation levels for whiplash claims and significant adverse changes to the discount rate, the method used to calculate compensation levels for serious injuries. According to independent expert analysis, these changes alone are calculated to save insurers up to £2.5 billion a year. 

The ABI report failed to mention the recent press announcements of soaring profits and increased shareholder returns from a number of major UK insurers. Once again, this seems like another ‘win-win’ for the insurers at the expense of fair and proper compensation for innocent and injured victims.