Car insurance firm market probe
The Office of Fair Trading (OFT) is to refer the private motor insurance market to the Competition Commission for practices that, it claims, drive up the cost of premiums.
The Office of Fair Trading (OFT) is to refer the private motor insurance market to the Competition Commission for practices that, it claims, drive up the cost of premiums.
John Fingleton, the Chief Executive of the Office for Fair Trading, said:
Competition in this market does not appear to work well for drivers. We believe the focus that insurers have on gaining the competitive edge through raising their rivals' costs means that drivers pay more than they need to for their motor insurance policies. Because insurers are distracted from competing primarily on the quality and value of service provided to insured drivers, incentives for greater efficiency may be reduced.
A road crash can have big financial impact - but new evidence suggests the insurance firms meant to protect us, are adding to the costs.
"Dysfunctional" practices in the motor insurance industry are pushing up premiums by £225 million a year, despite attempts to blame drivers