Understanding the Expense of Car Insurance

It is hard to understand why car insurance is so expensive. This drives them to try to find the cheapest fleet insurance available on the insurance market. Understanding how insurance is priced will allow people to find the cheapest policy with the most benefits they need.

Car insurance premiums are at a high level that can eat into budgets. The cost is so high because the cost of claims is high. Insurers will bump up premiums to protect their finances, even though many say they will make no profit. Car insurance claims are often fraudulent and it makes honest motorists pay the price.

Insurance companies can find over 2500 fraudulent claims each week. Insurers have established the Insurance Fraud Register in order to track people who are known to be fraudulent to combat the problem. Home insurance frauds are most common, but dishonest car insurance claims are the most expensive with people citing whiplash injuries.

Whiplash injuries are a problem since there is no real medical proof whiplash has occurred. It will not show up in X-rays or scans. Only the person who has been in an accident can know if they truly have whiplash. Everytime there is a claim for whiplash, car premiums go up. There are plans to cut the number of claims down by making it easier for insurance companies to challenge whiplash claims.

There are also plans to ban referral fees in personal injury claims. Personal injury details are often sold by car insurance companies to lawyers which leads to increases in compensation claims.

Personal injury claims relating to road accidents are rising steadily at 60 percent, even with roads getting safer and a gradual 20 percent fall in accidents. A ban may eliminate excesses of the compensation culture, leading to a drop in premiums.

Solicitors will also be capped so the most that can be charged in fees for a traffic accident case can be 500. The insurance industry is fighting uninsured drivers on top of all of this. There are over a million uninsured motorists on the roads who are costing responsible people more money.

Driving without car insurance means no premiums are paid, but the insurance company still has to cover costs of injuries and damage to other persons in the car or in the event of an accident. Uninsured drivers can add to the average car insurance premiums. These drivers kill over 150 people and injure over 23,000 other drivers every year.

Legislation is slowly being introduced to have higher penalties for uninsured motorists. This is called the Continuous Insurance Enforcement. The registered keeper of the vehicle must make sure their vehicle is insured at all times, even if it sits in the garage most of the time.

The only way motorists can get around the Continuous Insurance Enforcement is to declare a car off the road. Penalties for breaking rules are harsh. There will be fixed penalty fines and the vehicle can be clamped, impounded, or destroyed. In serious cases, motorists could face prosecution and huge fines.

Dishonest drivers will push up car insurance premiums for everyone. It comes down to the risk posed to the insurer. For example, women are safer drivers than men, but gender is no longer taken into account. However, age is still a factor in the cost of premiums.

Occupations can also increase the cost of car insurance cover when some jobs are considered a larger risk than others. When driving the car for business purposes, the insurer should know about it. Specialist policies need to be chosen for this kind of car use.