OFT Investigate Rising Car and Van Insurance Premiums

The OFT (Office of Fair Trading) are investigating the insurance industry as the average fully comprehensive car and van insurance premiums rose by 40% in the last 12 months to March. The steep increase in insurance premiums in the last year or so has put a squeeze on many individuals finances and the finances of businesses.

The insurance industry puts the blame fairly and squarely on personal injury claims against vehicle insurance, as a big reason why insurance costs have risen so much in recent times. The increase in costs has to be covered by an increase in premiums. The insurance industry also claims that motor insurance has not been a profitable affair for the past 16 years.

The OFT want evidence of exactly why the cost of car and van insurance has gone up so much and in particular why it has gone up so much in Northern Ireland in comparison to the rest of the UK. Of course this report could help to prove that the insurance companies do indeed have a valid reason for such large price increases.

The problem of high car insurance costs needs to be addressed. Whether this investigation by the OFT makes any real long term difference to the price of vehicle insurance remains to be seen. Will it just be paying lip service to consumer demands or will it actually result in a solution to the problem.