Reform of automobile insurance coverage market place announced

Regulators have announced plans to enhance competition among automobile insurance providers, which must result in cheaper cover for motorists.

Regulators have announced plans to boost competition among auto insurance providers, which need to result in cheaper cover for motorists.

The measures incorporate:

• far better information for buyers on the costs and rewards of no-claims bonus protection.


• a recommendation that the market regulator, the Monetary Conduct Authority (FCA), appears at how insurers inform customers about add-ons to automobile insurance policies.


• a ban on agreements amongst cost comparison websites and insurers which quit insurers selling policies for less on other online websites. 

These measures had been announced on Wednesday by government physique the Competitors and Markets Authority (CMA).

This follows a 2-year investigation into the vehicle insurance coverage marketplace to see how it could operate better for motorists.  

Elevated competitors ‘will benefit motorists’;

Alasdair Smith of the CMA mentioned: “There are more than 25 million privately registered vehicles in the UK.

“We feel these changes will advantage motorists who are presently paying higher premiums as a outcome of the difficulties we’;ve discovered.”

He said that price tag comparison internet sites such as Confused.com “definitely support motorists appear for the greatest deal, and this in turn has led insurers to compete a lot more intensely”.

But he added that there could be improvements in the way such internet sites operate.

Value comparison web site improvements

One of these improvements is the ban on agreements in between cost comparison internet sites and insurers which avoid insurers selling policies for less on rival comparison internet sites.

Confused.com does not have any such agreements with insurers in place.

Steve Sanders, finance director at Confused.com, mentioned: “The news that the CMA has banned such agreements amongst value comparison websites and insurers is welcomed by Confused.com. 

“This ruling will allow us to supply better rates for the same cover to even much more clients. 

“Here at Confused.com, we want to be capable to negotiate the very best offers we can with automobile insurance coverage providers and in turn pass those savings on to consumers. 

“We will continue to operate with insurance coverage providers to ensure we give our clients the greatest achievable service and value for their insurance demands, while remaining competitive.”

2-year investigation

This investigation into the vehicle insurance marketplace started in 2012.

This was when the Workplace of Fair Trading (OFT) decided to refer insurers to the Competition Commission after its personal study identified that insurers were taking benefit of motorists.

The CMA took more than the investigation from the Competitors Commission in April 2014.

The OFT identified that many insurers have been inflating the cost of repairs and replacement automobiles when 1 of their consumers had been involved in a automobile accident which was not their fault.

Nonetheless, the CMA investigation located that this was not as big a dilemma as previously imagined.

Alasdair Smith of the CMA added that the government body was nonetheless now looking at approaches to preserve the charges related with courtesy automobiles as low as attainable.

Evaluate automobile insurance – you could find a great deal in minutes Get a auto insurance coverage quote

Reform of automobile insurance coverage market place announced