The UK Insurance Blog

Further to my piece a couple of days ago, I’ve just been reading some information from the Manchester Police saying that uninsured drivers are six times more likely to have convictions for driving un-roadworthy vehicles and nine times more likely to have convictions for drink-driving.

And their crimes are said to put an extra £30 on every car insurance premium.

The latest technology fitted to lots of police cars ensures that vehicles not registered on the database system (it checks insurance, road tax, driving license and MOT) automatically trigger an alert to officers who, under the new powers, can seize cars. - That’s Good !

Drivers unable to produce proof of insurance have their vehicles impounded.

To reclaim their vehicles, owners must pay £105 for recovery, £12 a day storage, and a £200 fixed penalty notice or a fine imposed by a court. - That’s Bad !.

So for around £350 they can retrieve their cars and be driving around uninsured again, because it’s a certain fact that they won’t be wanting to pay the insurance premium that’s demanded following their conviction for “no insurance”, drunk driving etc.

If an owner fails to reclaim the vehicle within 14 days, it is crushed, scrapped or sold. - Ha…there’s the answer then. Lock ‘em all up for 15 days when you seize the car. When they get out and pay their fine present them with the block of crushed metal - Oh I like it!.

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An interesting piece in yesterday’s Telegraph talking about how easy it is forget that the contents of our houses increases over time. They’re reporting that it’s not unusual for claims adjusters to reduce a claim by as much as 50% simply because the contents of the house were underinsured. They state that “Figures published by Abbey last year show that 257,000 of all home insurance policies, across both building and contents cover, were declined as a result of underinsurance.” I can’t believe that the claims were totally disallowed, the normal procedure is to reduce the claim by the percentage of under valuation. Thus if I take out contents insurance that provides cover for £30,000 and the insurance assessor value the contents of the house at £60,000 then you should only expect to be paid half of the amount that you claim.

The article also points out that there is a wide difference in the blanket cover (i.e. the contents not individually valued and listed) offered by the leading insurance companies. Direct Line’s basic policy offers £15,000 of unspecified item cover whereas More Than has the limit set at £75,000. Once more it’s telling us that we should research all insurance cover before making a final choice. Product loyalty is often misplaced, one company could have the best value car insurance whereas their home insurance sucks…always take a few minutes to do some research. You’ll find a wide choice of insurers on the home insurance pages of the website.

An article from the Press Association tells us that Halifax Home Insurance have come up with some startling facts about home restoration projects. It seems that almost three million rooms have vanished over the past five years as homeowners knock down walls to create open-plan living space. An estimated 2.9 million rooms have been knocked into adjoining ones in the past five years, while plans are being made for a further 2.1 million homes to lose at least one room this year, according to the Halifax research.

The most popular wall to knock down is that between the dining room and the living room, with many people believing that the traditional dining room is part of a bygone era. The days of the whole family sitting around a dining table adorned with the best china whilst tucking into roast beef and yorkshire pudding seem to be gone for good. It seems that people now prefer the extra living space that joining the two rooms brings.

Estimations show that a further 590,000 dining rooms will be destroyed this year to create bigger kitchens or lounges and that the traditional standalone dining room could be extinct by 2020.

Larger living areas are also being created by knocking through the walls between living room and hallway or getting rid of utility rooms or studies to get bigger lounges, kitchens, bathrooms and bedrooms.

The worrying point about all this alteration work is that one in four people are planning to knock down walls themselves rather than employ a tradesman. At the same time half of people who carry out work don’t realise that they have to inform their insurer that the number of rooms is about to change, and that failing to do so could invalidate their house insurance.

David Rochester, head of underwriting at Halifax Home Insurance, said: “Britons have clearly fallen for open-plan living and are looking at ways in which they can make better use of the space inside their homes. Not only do we urge homeowners to make sure a qualified person carries out any structural work to their home, we also recommend seeking the advice of a qualified structural engineer before progressing work to knock down any walls.”

We’ve all seen the Fawlty Towers episode where Basil gets in a local firm of cheap builders to knock down a wall, only to find that they’ve removed a major retaining wall and the whole place is likely to collapse at any moment. Nobody is suggesting that such a farce could take place in your home but insurance companies get hundreds of claims each year for collapsed ceilings etc that are the result of people taking down the “wrong” wall, and the insurance companies simply don’t pay out on those claims, so be warned.

Two interesting reports on UK gap year travellers were brought to my attention by travelbite.co.uk. AA travel insurance reports that with backpackers carrying electronic instruments such as mobile phones, digital cameras, MP3 players and laptops, the value of an average backpack and its contents has risen to around £450. The AA estimate that at any given time backpackers from the UK are wandering around the world with £1.7 billion worth of electronic gadgetry stowed in their rucksacks. When you consider the low security of many cheap hotels and even the possibility of sleeping under the starts, it’s essential to hold a valid travel insurance policy. They warn that you must look for the correct type of policy which is a long stay or backpacker policy rather than an annual policy that runs for a year but each trip is limited to something like 28 days.

Around the same time as the AA report, American Express Travel Insurance published the results of a poll of 10,000 of their customers. Bizarrely, they say that one third of all gap years are taken by the over 55s. Now I’m not disputing that people of that age might well decide to take a trip around the world whilst they still have the energy and desire to want to do it, but it surely can’t be a gap year…a gap from what ?. Hell, they’re on the verge of retirement and there’s no scope for a gap year unless it’s the year between work and retirement, but then we normally call that early retirement don’t we?. Anyhow the poll showed that more than half of gap year travellers from the UK are over 25. Presumably those in their twenties and thirties are taking a gap between jobs or between freedom and parenthood which is still stretching the accepted definition of the term “gap year”.

Hardly surprisingly, American Express Travel Insurance were quick to point out the importance of arranging travel insurance before setting off on your big journey. Their advice was :

Liverpool Victoria have introduced a pet insurance policy that has no upper age limit. Pet insurance policies vary widely from insurer to insurer but generally you’ll find that a pet insurance company will not take on a new dog after age 8 or 9 and maybe a couple of years longer for a cat. They will often renew an existing policy beyond that age but with restrictions on certain parts of the policy.The new Liverpool Victoria policy allows you to take out insurance on a pet of any age over 8 weeks, but of course there are restrictions.

Cheaper (or should that be less expensive) pet insurance policies tend to fall into two camps, either they restrict payment on any single ailment to 12 months or they restrict the maximum amount that they will pay out for each condition - or even a combination of the two.

The new Liverpool Vic product offers both choices. Cheaper of the two restricts payment to twelve months on any single ailment with a top limit of £5,000 whilst a more expensive option offers a total of £5,000 for a single ailment with no time limit. In both cases the excess payable on any claim is £60. An average annual premium for a 10-year-old cat on the Essential plan is £106 and £146 on Premier whilst a Labrador dog (prone to leg ailments in old age) is £198 and £306.

Now, as with most insurance, you have a decision to make. Does it make sense to insure or would you be better off sitting it out and stumping up for the vet bill?. It really is a toss of the coin thing, who knows what’s going to happen in the future?. For sure, there are certain people who much prefer to know that whatever happens to their pet, it will be paid for by the insurance company and obviously for those people pet insurance is essential.

In my own case I bought my dog, A Hungarian Vizsla, from the breeder when he was 4 months old. The breeder had insured him for a year and when that expired I let the policy lapse. Up until about age 9 he didn’t have any unexpected visits to the vet, just the normal booster injections etc which aren’t paid for by pet insurance in any case. Then at about 10 years of age he developed a limp in his shoulder. A few visits to specialists who all scratched their heads and said that they couldn’t see what the problem was ate up a thousand or more. Medication has cost a bit more. To be honest I don’t know if I’d have been better off with insurance. What you do have to remember that the insurance company will not cover existing medical conditions, so you can’t wait until the dog starts hobbling before insuring him. My fella’s now over 14 and he’s been worth every penny, he’s my best friend.

Horse & Hound reports that a forthcoming court case will highlight the need for racehorse owners to hold third party liability insurance.  In a tragic accident at Wolverhampton race course in April 2005 Chris Kinane, assistant to Midlands trainer Ian Williams, was kicked in the head by Saameq, a horse trained by Ian Semple and owned by David Irvine. Chris Kinane was serously injured in the incident and his injuries are so severe that he will require constant care for the rest of his life.

In the case coming to court this year messrs Semple and  Irvine are being sued for negligence. According to the Animals Act 1971, all horse owners are liable for the actions of their horses no matter how much reasonable care is taken to avoid an accident. Since March 2007 third party liability insurance has been mandatory for all trainers but there has been nothing in place requiring owners to be similarly covered and sadly Mr Irvine, the owner of the horse, was uninsured.

The Racehorse Owners’ Association which represents 7,200 of the UK’s 16,000 racehorse owners has this year increased its membership fees to add third party liability insurance to it’s list of benefits but that still leaves many horse owners without this essential cover.  Both of the horse insurance companies on the web site offer third party liability insurance as either part of the policy or as an add-on.

I’ve just been reading an article on the Huddersfield Daily Examiner that claims that one in five of the vehicles driving around their area is uninsured. Incredibly, it then goes on to claim that in the BD3 district of Bradford an unbelievable 57% of vehicles is uninsured.

Now I don’t know if their figures are accurate, they come from The West Yorkshire Passenger Transport Authority, which is a public body comprising 22 councillors from the areas around Leeds & Bradford. With their stated aim being “To be the driving force co-ordinating the provision and development of high-quality public transport services for everybody within West Yorkshire”, they’ve certainly got an agenda to disuade people from using their cars but I would still imagine that they wouldn’t come out with such statistics if they weren’t accurate.

What’s mystifying me is that when I watch “Road Wars” on Sky telly, the police cars are all equipped with fancy cameras that read number plates and then check with databases somewhere to ensure that the vehicle is taxed and insured. Presumably, police cars throughout the country are equipped with the same high tech equipment so why are so many people being allowed to drive around uninsured?.

I’ve seen the Sky TV cops seize and crush a car before now, but can’t remember what offense the perpetrators had committed. If the police were to seize and crush every uninsured car being driven on our roads then the country would be a better place to live in. And whilst they’re driving around checking for uninsured vehicles they could enforce another law that’s totally ignored, they could arrest and disqualify people using mobile phones whilst driving !!.

The Guardian reports that new Department of transport figures are showing horrific statistics for the two wheelers amongst us. Bikes constitute just 4% of the vehicles on our roads but their riders account for nearly a third of all road deaths. Car drivers are getting safer as designs improve and cars are fitted with air bags to reduce risks in an accident. Bikers are still fitted with a fibreglass bonnet to protect them, it’s an unequal struggle.

Statistics show that a motorcycle or scooter rider  is 50 times more likely to be killed or seriously hurt than a car driver for each mile travelled, and twice as likely as a pedal cyclist.
Insurer yesinsurance.co.uk says the recent trend for inexperienced middle-aged men to ride motorbikes is contributing to accident numbers. Deaths and serious injuries to riders in their forties have doubled in the past ten years compared with a fall in the younger age brackets.

Paul Purdy of YesInsurance believes that the steadily increasing price of fuel and the fact that two wheeled vehicles  are exempt from paying the London congestion charge have been two of the factors encouraging car drivers to switch to motorcycles.

I know that many bike accidents are the result of car drivers doing stupid or inconsiderate things BUT you’ve got to ride defensibly, expecting the worst of all motorists and truck drivers. It’s no good laying in a hospital bed with broken bones or worse and explaining that a motorist pulled out and didn’t see you. He’s got a dented vehicle, you’ve got a broken body…or worse.

There was a general feeling in the office that residents of Northern Ireland were getting heavily penalised when it came time to renew their motor insurance. Now that peace has returned to the Province and everything has been quiet now for several years, we were wondering if and why the people of Northern Ireland were paying over the odds for their insurance. We decided to do a little experiment to see how much difference your location makes to car insurance premiums.

Meet David Stone (Dave to his friends). He’s a married man born in 1966 with a squeeky clean license, never in trouble with the police and with 5 years no claims discount. He’s just bought a 2005 Ford Focus 1.4 LX for the knock down price of £7,500. He’s a model citizen, well he certainly should be because we invented him a few days ago. He tends to move around the country a bit, but apart from that he’s your absolutely normal, totally fictional guy. Let me explain. We wanted to put identical details into a selection of online car insurance sites to see how big a difference there is in premiums depending on your location. Please try to remember that we’re not comparing premiums between companies, some of them might well be offering extra facilities such as roadside recovery or protected NCD in their prices, all that we are comparing is the difference in price from the same insurer when we move Dave around the country.

Remembering that our original task was to prove that the car drivers of Northern Ireland were being unfairly treated and armed with street maps (kindly provided by Google Maps), we looked around for likely “dodgy” locations.

Not knowing Belfast at all we plumped for Newforge Lane which is a mile or two to the south of Belfast city centre (and probably very plush and not “dodgy” at all, but you’ll understand the “dodgy” reference in a minute).

Our next location was Bold Street in Manchester. It’s in the Moss Side part of the city which gained notoriety across Britain during the 1980s and 1990s due to high crime levels and several riots.

Next we moved Dave to Electric Avenue in Brixton, London. Brixton has long been associated with gun crime, poverty, drugs and violence and is often classed as London’s Compton or Harlem. It has the reputation of being one of the most dangerous places in the UK, with Coldharbour Lane once holding the statistic of 3 shootings per week in the mid-90’s. It is a place any visitor or inhabitant alike, would be wise to not venture around at night.

Our final resting place needs a little explanation. One of the leading UK insurance companies, Endsleigh, did a report on the best and worst cities for motor accidents and car theft. In the report, Belfast is the safest for accidents and Hull is the worst for theft by a considerable margin. So Hull it was to be, in fact Anlaby Road in Hull which looks to be pretty much in the centre of town.

OK, back to the plan. Dave was going to get quotes for comprehensive car insurance from a variety of insurers, each time getting 4 quotes, one for each location. All other details input would be exactly the same for each insurer and for each location. By doing this we should be able to see if car insurance in Northern Ireland has excessively high car insurance premiums.

The results surprised everyone in the office and I think they’ll surprise you. The variance between insurers is amazing and if we learn one thing from this exercise it should be to shop around before parting with your hard earned cash. A bad address to one insurer seems to be treated as perfectly ok by another, there’s no rhyme nor reason for some of the differences. Let’s go ahead and look at some of the results.

We started by trying to get quotes for the Northern Ireland address from our sister site Instant Online Insurance. There are a number of direct insurers on there such as Direct Line that don’t appear on the car insurance comparison websites. The results are in the following table.

Car Insurance Premiums vs Location

Please remember that the object of this exercise was to show the differing rates charged for car insurance depending on where you live. Our original intention was to confirm that people living in Northern Ireland were getting a raw deal on their car insurance premiums. As you will see below, we were probably some way off the mark but what the figures do prove is that it pays to shop around when buying car insurance and that each insurer seems to have their own ideas on which are both the safest and the most dangerous areas in the country.

Direct Insurers

These are the online direct insurers that tend not to appear on comparison websites.

_{Notes
1) Privilege, MORE TH>N and Churchill wouldn’t insure our Northern Ireland resident.
2) Endsleigh don’t seem to have much confidence in their own research, Hull is half the price of Manchester
3) MORE TH>N were a complete pain in the whatsit. Their quote process crashed 3 or 4 times and when we did eventually get to the end they wouldn’t insure us.
4) Since Dave was just about the most perfect virtual motorist we could invent, you’ve got to assume that Privilege, MORE TH>N and Churchill don’t insure anybody in Northern Ireland, in which case why don’t they turn you down as soon as you enter your address. It’s frustrating to get to the end of one of these online car insurance quote forms only to be told “sorry”.
5) Judging by the premiums quoted by the companies willing to offer insurance in Northern Ireland, the risks are no greater than in many parts of England, so let’s hope that a few more insurers will begin to offer car insurance for Northern Ireland residents.}

Car Insurance - Compare The Market

This table is the result of putting 4 different addresses into the quote engine with exactly the same proposer details, only his address is changed each time.

Compare The Market

_{Notes
1) As in the previous table there were a number of companies that wouldn’t quote for Northern Ireland even though they quoted for our other locations. They are at the bottom of the list
2) Royal & Sun Alliance didn’t quote for Hull but it may just have been a server failure rather than their unwillingness to quote.}

So once more we don’t really see a positive sign of discrimination against the people of Northern Ireland and would hope that some of those companies that chose not to quote might be willing to dip their toe in the water before too long.

What was reinforced most strongly was that it’s imperative to shop around for car insurance quotes before committing to a particular insurer. These companies have hugely differing views on safe and unsafe areas and we should take advantage of that by saving lots of money on car insurance premiums.

Our next little survey will involve Bob the Builder and his search for cheap home insurance and soon afterwards Rover the Dog will be imparting some wisdom on pet insurance. In the meantime, if you’d like to tell us about how low or high your insurance premiums are then hit the comment button and drop us a line. Don’t give your full address, just a post code is fine. So if you think that you have the cheapest premiums in the country in your area please let us know. Oh and if you’re insured with Norwich Union please give us the post code, at the moment we have the feeling that with those prices they’re either not looking for motor insurance or perhaps they’re just on a different planet ?.

Ross

We’ve finally got round to setting up the blog that will let us keep you informed of what’s happening in the UK insurance market. It’s a huge area that affects us all, since car insurance is mandatory for all vehicles and you’d be a brave man in this day and age to fail to insure your house and its contents.

We’ll bring you details of any special offers that might save you some money but we also intend to offer you a better insight into the UK insurance market with some detailed articles on various aspects of the subject that you might find of interest. The first of these articles looks at how your location affects the car insurance premiums of different insurers. It’s an interesting read that emphasises our message that you should shop around for the best deals and never accept an insurance renewal without checking the market.