The great British insurance ripoff

LIFE ON CARS has been innundated this week with responses from readers who say they are being crippled by the soaring cost of car insurance.

Last week we reported on a Commons enquiry which has been set up to investigate the rising cost of premiums, particularly for younger drivers, and residents from across the region have got in touch to share their thoughts on the issue.

Maureen Gladhill reported difficulties in getting quotes for her two daughters, and said:

"I feel that it is onerous and extremely difficult to pass a driving test nowadays and yet the greedy insurers still penalise young drivers, I feel so sorry for our young people, hammered with extortionate tuition fees, no job prospects and hammered by the insurance industry, it is about time for a parliamentary enquiry.

"I expect the insurers will claim the amount of claims (fraudulent or otherwise) account for premium increases, but I know that the government has tightened up on no win no fee with the new insurance portal system, so come on."

Last week a Transport Select Committee was set up in Westminster to look at the cost of car insurance, armed with new research which suggests a whopping 96% of younger drivers feel they are being "priced off the road" due to high insurance premiums.

A reader from Maghull, who did not wish to be named, agreed with that view and said:

"I fear these insurance companies are seeing an easy target within the driving community not only with young drivers but all drivers in general.

"All in all its a complete rip off. Not only for being young, male, female the car you drive but also dependent where you live. You are discriminated for where you live which I also feel is totally unacceptable. It's a joke and although i dont agree with having no insurance and driving around, I can see why it's an option. The insurance companies need a strip tearing from them and told to drop their prices."

The car insurance industry responded to the Parliamentary enquiry by saying that the rise in claims from personal injury lawsuits and an increase in uninsured driving had helped to drive costs up.

Otto Thoresen, director general of the Association of British Insurers, said:

"Rising claims costs from personal injury claims, excessive legal costs, insurance fraud and uninsured driving, coupled with lower investment returns in recent years, have unfortunately led to rising motor insurance bills for many customers.

"In fact the motor insurance sector has not been profitable for the last sixteen years because the amount paid out in claims and expenses has been greater than that received in premiums."

Younger motorists have reported paying premiums which are hundreds - if not thousands - of pounds in order to get insured, which has led to worries being discussed at the committee that increasing numbers of motorists are resorting to driving with no insurance at all.

Sue Bruce was another parent who complained of crippling prices to insure her children, and told Life On Cars:

"I have paid £3,500 for my 18 year old son to be on the road in this Citroen C1 which incidentally is not much more than the car cost. I do appreciate that the insurance companies have to cover themselves for the small amount of young people that do drive erratic on the roads, but when my daughter passed her test the insurance was £1,900 which is a big difference.

"Maybe these insurance companies. could come up with some kind of scheme where they would accept the driver paying monthly then earning some kind of a no claims bonus month by month therefore making it more affordable for young drivers to get on the road."