Office of Fair Trading Investigates Insurance Companies

premium

After typing in various personal details and details about your car and employment you eagerly await for the online car insurance provider to give you a quote. Most recently many have been shocked by the prices which they have been quoted to insure their car for a year!

Most recently though the Office of Fair Trading is investigating insurance companies after there has been a rise in premiums of around 40%. They have issued insurance companies with a “Call for Evidence” which is the first stepping stone leading to a full scale inquiry.

Insurance companies have blamed fake claims, fraud and a compensation culture for the rising cost of car insurance cover. Investigation into this by the Office of Fair Trading has suggested that it is the companies themselves which are pushing people to their limits with the current financial difficulties they face every single day.

When you think about it logically though people are looking for the best deals possible for car insurance because of their financial status and therefore you would think that competition between companies would mean that premiums were kept low but this really isn’t the case.

The Office of Fair Trading has decided to focus on price comparison websites; believe it or not some of these are actually owned by insurance companies themselves. As part of these sites though additional products such as break down cover, windscreen cover and items such as legal cover are offered and they want to look at the impact these are having on motorists.

In addition to focusing on price comparison websites and their additional services though they are also going to look at how claims are dealt with and then their findings will be announced in December.

By placing insurance companies under pressure through investigations such as this one conducted by the Office of Fair Trading, we are hoping that adequate steps will be taken in order to try and eradicate high insurance premiums from being presented to motorists who want to insure their vehicle but simply cannot afford too!

Insurance companies should strive and look to a future where customers can get the best deal possible for their vehicle insurance without feeling ripped off by high insurance premiums.

The rise in insurance premiums is not just a local problem but it is of national importance and there needs to be action taken in order to stop the rising premiums before it gets out of hand.

14th September 2011, 11:39