Sunday, 12 June 2011

Car Premiums Rise 40% as Parasitic Claims Fleece U.K. Grandmas

http://www.bloomberg.com/news/2011-06-08/car-premiums-rise-40-as-parasitic-claims-fleece-u-k-grandmas.html

The U.K. system creates clear losers -- customers who this year pay average premiums 40 percent higher than in 2010, and car insurance companies, who’ve shelled out more than they take in for 15 consecutive years as personal injury claims soared. Winners include lawyers, vehicle repairers, car hire firms, doctors and even the police, who benefit from a “merry-go-round” of referral fees, according to a House of Commons committee report in March.

SS says

Thank God !!!! I have left the UK for good.

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“It’s a parasitic system,” said Martin Milliner, director of claims at Liverpool Victoria Friendly Society Ltd., the U.K.’s third largest car insurer. “It increases the opportunity for fraud, malpractice and the more worrying trend of where that fraud money goes,” including organized crime.

Fraud is only one of the reasons why premiums are rising. The House of Commons Transport Committee report criticized a complex system of referral fees that inflates the cost of genuine accidents, encourages more people to claim for personal injuries and makes fraud easier.

One insurer, Admiral Plc, is bucking the trend. The firm, which insures 10 percent of British cars, is the best-performing insurer in Europe over the last five years and last year paid out 89 pence in claims for every pound it took in premiums.

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