Whiplash reform sees insurance premiums drop

Lloyd Doyle
April 16, 2018

This represents the biggest quarterly decrease in four years and is the first time prices have fallen since 2015, with United Kingdom motorists now paying an average of £768 for cover. Overall, men pay approximately £95 more than women. However, in September the Ministry of Justice said it would revise the scheme.

The Ogden rate was reduced last April, which cost insurance firms large sums of money.

The Ogden rate is a formula used to calculate compensation for accidents, and a new rate proposed by the government previous year sparked outrage among insurers and threats of huge premium increases.

Insurers are forbidden by law to set different vehicle insurance premiums exclusively based on gender.

'For example, men tend to drive more expensive cars with larger engines, on average, so they make higher-value claims.

Unless motorists take the time to shop around, it appears any savings aren't being passed on at renewal time with many insurers blatantly increasing premiums for no obvious reason.

Meanwhile, the government last month announced measures to curb the high number of whiplash claims that cost United Kingdom drivers more than £1bn a year.

Aside from analysis of the market, Confused also faced another problem: lower prices surely means people need to do less shopping around and - this is where it gets awkward - less scouting of comparison sites?

Some age-brackets are bucking the downward trend, such as 68-year olds, who have seen their premiums rise by £40, or 8 per cent, since last year. The average male driver aged 17 to 20 pays £2,348 on average, compared with £1,699 paid by women of the same age.

In Scotland, premiums are also still increasing, with motorists in the Scottish Borders area suffering the largest increase (6%) since a year ago.

However, drivers living in Inner London are celebrating the biggest price reduction, making savings of £81, or a decline of 6 per cent, since last.

In fact, a nationally representative survey of United Kingdom drivers reveals those who stayed with the same insurer and renewed their auto insurance between January and March this year saw their premiums go up by £45 on average.

Other reports by Iphone Fresh

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