Commenting on the launch of a government taskforce of industry experts and consumer champions to tackle spiralling insurance costs for drivers, Matthew Maxwell Scott, executive director of the Association of Consumer Support Organisations (ACSO), which represents companies supporting consumers in the civil justice system, said:
“It is regrettable that the promised Competition and markets Authority/Financial Conduct Authority investigation, which would have been properly independent, has been shelved in favour of a largely industry-led approach.
“It seems strange to ask the ABI to be at the centre of an investigation into its own members’ pricing behaviour. The usual approach is to blame everyone in the claims supply chain for their own strategic failures, we will see if there is any change here.
“Insurers made a fortune during the pandemic, but management largely failed to anticipate the direction of travel in the market following this, and customers paid the price through soaring premiums.
“Given motor insurance is a compulsory product, insurers must be far more transparent on pricing, and especially where investment returns are concerned, as well as the profits they make from customers who choose to pay their premiums on a monthly basis.
“However, even if the government is not doing what it pledged in opposition, it is at least doing something, and consumer groups such as ACSO will seek to participate fully in the process.
“We also call on the taskforce to explore whether insurance offers good value for money not just at the point of purchase but also at the point of claim, especially as the data shows show fewer claims being made, despite rises in road usage post pandemic and accident rates at similar levels.
“High prices will have almost certainly increased the number of uninsured drivers on our roads, which is understandable given the soaring cost of insurance and needs to be tackled, including through more robust police enforcement and better data sharing.”
For details on the taskforce, see here.