Cash for crash car fraud driving up insurance quotes

Earlier this year it was estimated that insurance quotes would rise by as much as 13%; though most of us were sceptical the majority of drivers found that this was in fact very true. Drivers of all ages saw their premium go up even if they hadn’t made a claim in the last five years. The average price hike on renewal quotes at the beginning of this year was as much as £50. The beginning of 2011 will also see car insurance renewal quotes rise again and this will be the third year that car insurance has gone up.

In 2009 car insurance renewal quotes went up by 10%, in 2010 they went up by 13% while 2011 will see quotes rise by as much as 50%! As more and more people struggle to find an affordable car insurance quote, many are simply taking the risk and driving without insurance. Others are being cheekier and staging cash-for-crash car frauds with the possibility of making a quick buck. For every £100 that was claimed for this year, it has cost insurance companies £123; this in turn has caused them to make substantial losses. The only way to recuperate these losses is to drive up the cost of insurance cover.

Personal injury claims in the UK are the highest in Europe though we have less accidents each year. This has been fuelled by personal injury lawyers who encourage those who have been in accidents to sue rather than take some painkillers and time off from work. As always it will be new and younger drivers that will face the biggest hike in car insurance cover but the over 40’s age group will also face an increase of up to 30% so it would seem that everyone is being penalised.

At the moment there doesn’t seem to be any laws preventing insurance companies for demanding so much money and as it is illegal to drive without insurance, we have no choice but to pay the ridiculous amount of money for cover. Although I do agree that the boy racers and those that have extensive modifications to their cars such as spoilers, tinted windows and alloys are a small minority, they serve no purpose other than ‘bling’ and should be banned.

Insurance companies also have a clause stating that all accidents must be reported to them and not handled by you and the other party involved. But what they don’t tell you is that it is far more expensive to go through them and would save your no claims if you and the other party reached a mutual agreement. In one case a driver was involved in a minor accident where the front bumper was dented, the insurance company quoted in excess of £600 for repairs whereas the car manufacturer quoted £200 for the same work carried out. How is that fair?