The Office of Fair Trading (OFT) have said in a statement today (08 August) that it had called for evidence into how the car insurance sector operates to see if consumers are being treated fairly and if there can be more effective competition in the sector.
According to research conducted by the AA’s British Insurance Premium Index, the ‘shoparound average’ for annual comprehensive car insurance cover rose by over 40 per cent for the last 12 months ending in March.
A spokesperson for the OFT has said, “As part of its work, the OFT is interested in examining reports that car insurance premiums in Northern Ireland are significantly higher than they are in the rest of the UK, and understanding the reasons for any difference.”
Last month, the Consumer Council for Northern Ireland launched a revolutionary campaign to reduce the cost of car insurance in Northern Ireland. This included making a formal submission to the OFT asking for it to examine the motor insurance market across the whole of Northern Ireland.
As part of this campaign the OFT are asking insurers and others involved in car insurance for their views on the private motor insurance market. This will include:
- The role of price comparison sites when searching for policies.
- The provision of replacement vehicles to drivers who are involved in accidents that are not their fault.
- Insurance companies‘ use of panels of approved repairers in the event of a claim.
- Ancillary products sold by insurance companies in addition to standard motor insurance cover.
If this campaign proves to be successful in Northern Ireland, it is easy to speculate that it could move throughout the rest of the UK and could possibly see the average price of car insurance fall across the board.