Fraud and uninsured drivers are costing each and every car insurance policyholder £30 per policy. That is the amount car insurers add to our renewal premiums just to pay for these claims. One must ask that if they know how much these claims cost, they can identify the fraudulent claimants so why do other policyholders have to pay for it?

It’s the insurers fault for paying it out, not the policyholders!

Personal injury claims have risen 22% and are adding a further £66 to each and every policy with whiplash injury claims, in particular rising sharply.

It is suggested that insurers pay out £105 for every £100 they receive in insurance premium. Before the recent credit crunch, this shortfall was considered manageable with insurers able to offset this apparent loss by investing in stocks and shares, but given the substantial falls in global stock markets, this can no longer be considered viable and safe.

Insurers therefore have no option other than to pass recovery of the shortfall onto policyholders.

The AA is allegedly planning to increase their premiums by 10-11% in 2009 with other insurers rumoured to be considering even bigger increases.

Not good news. Perhaps insurers could consider investing more time and effort into mitigating their losses by investigating claims more thoroughly rather than simply passing these unnecessary losses directly on to the customer.

Do they do this because of incompetence, lethargy, because it’s the easiest thing to do, or are they including their compulsory obligation to contribute to the Motor Insurance Bureau funding from which uninsured compensation payouts are made?

There is one thing for certain, no Government or Council department would get away with it without having to undergo some seriously strong questioning via the house and the associated adverse publicity, so how do they get away with it?

Come on insurers, start publicising what you are doing to protect us, or is it that you simply aren’t doing anything?

You have always been prepared to spend millions in your efforts to get our money, now start spending some on telling us how you are trying to keep insurance premiums down please.

Motorists deliberately causing road accidents with the intention of lodging fraudulent car insurance claims against an innocent third party continues to receive police and insurance companies attention.

The incidents are predominantly caused by a driver stopping quickly for no apparent reason, hoping the driver of the car behind them will not be able to stop in time and collides with the fraudster’s vehicle.

These fraudsters do not always work alone and have colleagues in a separate car who manoever themselves into the spot behind the driver they are trying to catch out and drive very closely to their back bumper.

Once in place, the driver of the first car brakes sharply, the innocent victim in the vehicle behind, being aware of how close the car behind them is to their own car and fearing they themselves will be shunted, fails to brake quickly enough and collides with the fraudsters vehicle.

The driver of the first vehicle will appear uninjured at the time but subsequently claim for personal injuries from the victims insurance policy affecting their no claims bonus.

The only comfort these innocent drivers can take from the experience is that:-

1. Police forces across the UK are always on the look out for this kind of activity and the number of prosecutions for such activity is increasing.

2. Insurance companies record all claims on a central database which will alert insurers to possible fraudsters which the insurance companies can then pass on any suspicions to the police for further investigation.

Over the course of many research projects, it has been established that most drivers believe their own driving skill is above average.

Even drivers opting to take a Driver Improvement Course rather than being prosecuted for Careless Driving following their involvement in an accident rated themselves above average*.

Few realise how often their actions whilst behind the wheel could lead to prosecution irrespective of whether they are involved in an accident.

The Road Traffic Act states that it is an offence to drive a mechanically propelled vehicle on a road or other public place without due care and attention. Prosecution will surround proving the driver in question was not driving to the required standard.

You may notice that the law states a “mechanically propelled vehicle” meaning the driver does not actually have to be driving a motor vehicle.

Furthermore, the offence does not have to take place on the public road but anywhere where there is public access. 

Drivers could be prosecuted for driving whilst :

• Eating, drinking or smoking
• Retuning their car radio or CD player
• Trying to read
• Playng music too loud affecting other road users and preventing them  from hearing other road noises clearly

Penalties following a conviction for careless driving can vary from a fine, 3 – 9 conviction points put onto the driving licence, and even disqualification at the court’s discretion.

* Source: Department for Transport

Any experienced car owner will know that insurance providers place quite a risk rating on professional sportspersons applying what is known in the trade as a “loading” to insurance premiums.

Christiano Ronaldo may have been lucky enough to escape injury to himself or anyone else for that matter as a result of him losing control of his nice, 2 day old Ferrari 599 GTB worth some £200,000 in a tunnel near Manchester airport but it is predicted he will not be anything like as lucky when it comes to arranging his next lot of car insurance.

The AA have stated that following a quick phone around, they have been unable to find any insurer they work with that would insure Ronaldo following his accident saying:

“We cannot find anybody who would touch him with a bargepole”.

“The minimum age to get insured for that car would be 25 and then the best price we could find would be £44,000 but if the person had had an accident that would go up to around £100,000.”

Yes, in all likelihood, there will be an insurer out there prepared to take on the risk and it will more than likely be at a seriously hefty annual premium, and that’s for anyone, let alone a professional footballer.

When thinking about such high profile occupations and the asociated risks, insurers will consider the likelihood of the car owner having passengers occasionally, equally as high profile, and indeed, valuable (in monetary terms) in the car.

Any accident whilst these people are in the car as well and suffer injury could have seriously damaging personal injuries that say result in them being unable to continue  playing football at the highest level or even altogether and insurers would be paying out for loss of earnings, sponsors for the player being unable failure to fulfil their contracts etc. The costs will just escalate to astronimcal proportions.

However, even at £100,000 per annum insurance premium, it still equates less than 1 week’s salary he receives from Manchester United for Ronaldo. Add all his sponsorhip incomes and it shouldn’t hurt him financially too much, so he won’t need too much sympathy.

Don’t get too upset Christiano, the bottom line is that a car is only a piece of metal/whatever compound it was made with and can always be replaced, albeit at a price.

Life is far more precious.

Drivers will be aware of the powers of the courts and the police to impose penalties for driving offences.

These are known as convictions and can seriously affect the premiums insurance providers will charge you for an annual motor insurance policy.

Just like any other offence, the courts’ powers attempts to balance the penalty for breaking the law with the severity of the offence.

Each endorsement carries a unique offence code which in turn attracts ‘penalty points’ on a scale from one to eleven, depending on the severity of the offence.

The endorsement (and penalty points) are added to your driving history and recorded  on your licence. Some offences can even result in a lengthy disqualification and/or a prison sentence.

The penalty points associated with conviction codes varies from 3 to 11 points.

The period endorsements will remain on your licence varies from 4 to 11 years.

It is also worth noting that there is a system whereby if you build up 12 or more penalty points within a period of three years, you will be liable to be disqualified under the ‘totting-up’ system.

Finally, new drivers need to be especially careful as your driving licence is automatically revoked (withdrawn) if you build up six or more penalty points within two years of passing your first driving test.

You can learn more about convictions and penalty points from the DVLA by clicking here.

It is said that car tax evasion is more than three times higher in Northern Ireland than it is in the rest of the UK.

Fail to display a valid Road Fund Licence in your car, anywhere in the UK, and you will receive an endorsement on your driving licence which could in turn, affect your insurance premium, together with up to a £1,000 fine.

New legislation introduced last October means that cars not displaying a tax disc can now be clamped or removed from any public place and during a two week period in September last year, the Driver Vehicle Licensing Agency (DVLA) and police ran a pilot scheme in Belfast, clamping more than 300 unlicensed vehicles.
 
The pilot operation showed that more than 50% of those vehicles that were not displaying a road fund licence didn’t have valid insurance either, and 40% of those vehicles that were old enough to require an MOT Certificate didn’t have one.

Owners of clamped vehicles can expect to pay up to £260 to get their vehicle released or be required to pay £100 if they can provide evidence of a valid Road Fund Licence.

Fail to reclaim your vehicle within 7 days and you may find your too late – your car may be crushed.

Try to cancel your insurance policy and you could find yourself punished financially again as refunds, following cancellation of a motor insurance policy, usually attract cancellation charges and you could find yourself losing more than the cost of the Road Fund Licence depending how much your insurance premium was at renewal.

Of course you do!

It is against the law to drive a motor car on the Public Highway without at least having valid insurance in place covering you against damage to other people or their property. This is known as Third Party cover.

According to the Association of British Insurers (ABI) in 2006, one in six private car drivers make a claim each year which cost the insurance industry more than £18.7 million in private motor vehicle claims.

If you are involved in an accident and considered to be at fault whilst driving uninsured, you will not only have to pay for the repairs to your own car, but you will be obliged to pay for repairs to the other person(s) car/property and even more worrying, compensation in respect of any injuries sustained by the other parties and passengers.

You personal possessions and property could be taken and sold to pay for these costs.

It is also highly probable that the police will prosecute you with the courts imposing a conviction which will stay on your licence for up to 10 years (depending on the nature of the offence).

After your home, your car is probably your most expensive purchase. Damage caused by or done to your car could be financially crippling, so look on your car insurance as offering you peace of mind that should an accident occur you are protected.

Barring age restrictions, once you have passed your driving test, there is virtually no legal requirement for you to retake your driving test.

There is no harm however, revisiting certain elements simply to ensure you remain up to speed with developments.

Remember, ignorance is no excuse

One thing that many drivers forget are the meanings of various road signs.

After all, nobody wants to be involved in an accident and put their no claims bonus in jeopardy or get prosecuted by the police simply because they didn’t heed/remember what the road sign was telling them.

Ask yourself:-

– What shape are most warning signs?

– What shape are most signs giving orders?

– What colour are most signs offering information?

We all probably know that the answers to the first 2 questions are round and triangular but which is which?

If you are unsure, perhaps now would be an opportune time to remind yourself and have a quick look at the UK Road Signs in the Highway Code on Government’s Travel and Transport website.

The website includes details of all other signage, road and vehicle markings you are likely to come across.

It’s certainly worth it to avoid the risk of conviction or losing some of your no claims bonus if you cause an accident.

One of the most critical things to consider before purchasing a car, particularly for young drivers, those with little or nil no claims bonus, driving convictions or indeed, medical conditions that may increase their insurance premiums is to ensure you can afford to maintain, insure and run the car.

From an insurance point of view, it is useful therefore to be able to identify the car groups in advance of starting your search and perhaps obtaining an indication from insurers what the premium is likely to be for cars in that car insurance group.

As an example, unless they really want to do so and indeed, can afford to do so, young drivers should stay clear of high performance cars which attract a high insurance car group rating.

Car groups start at Group 1 which includes cars such as the Vauxhall Corsa Club 1.0 litre and goes up to Group 20 which includes cars such as the Subaru Impreza which appears popular with younger drivers.

One of the main underwriting factors affecting insurance premiums is the type of car, and the higher the car group, the higher the premium.

It is worth therefore checking the car insurance group rating of the cars you are thinking of buying beforehand as you don’t want to waste time, energy and petrol driving around looking at cars, it turns out, you cannot afford to insure.

Remember, whilst you are doing that, you may have missed out on that absolute bargain of a car that you could afford to insure.

Parkers, a well known and respected organisation within the motoring community includes a section within their car insurance advice section to help you trace the relevant car insurance group rating for any particular car.

It is important when you begin learning to drive that you are fully aware of your role and responsibilities as well as the general rules of the road.

Learner drivers are governed by slightly different rules and are advised to stay within the following guidelines to ensure they drive within the limits of the law and are able to enjoy the whole learning process.

Minimum age

Learner drivers must hold a provisional driving licence. By law you must be at least 17 years old and are able to apply for a provisional licence up to 3 months in advance of your 17th birthday.

You must pass your theory test before you will be permitted to complete the actual driving examination.

It is prudent that people learn to drive with approved driving schools or instructors but this is not mandatory.

Ensure the car is in a roadworthy condition?

It is a legal requirement for all vehicles driven on UK roads to have a valid MOT certificate. These are issued for a period of 12 months but do not necessarily mean the car is in a roadworthy condition at the time you are driving it so always ensure you check to make sure that all lights, brakes, mirrors and indicators are fully functioning.

Insurance and Tax

A further legal requirement is that all vehicles driven on UK roads display a valid Road Fund Licence and the driver is insured to actually drive the vehicle.

If the vehicle is not displaying valid Road Fund Licence, the vehicle should not be driven on our public highways. The tax can be obtained by the owner of the vehicle on production of a valid insurance certificate, MOT Certificate, Road Fund Tax reminder or evidence of ownership (usually the V5 logbook) and can be purchased at many Post Offices or direct from DVLA.
 
Displaying L Plates

You must display ‘L’ plates so that fully licensed drivers are aware that you are a learner driver. ‘L’ plates can be fixed to the front and rear bumpers of your vehicle or can be purchased with magnetic plates which can be removed if the car is being used by a fully licensed driver.

Accompanying Drivers

You are not permitted to drive the vehicle on a public highway without being accompanied by another driver who must hold a full licence which permits them to drive the type of vehicle you are driving. They must be at least 21 years old and have held their full licence for at least 3 years.

Motorway Driving

Provisional licence holders are not permitted by law to drive on motorways even if accompanied by a person holding a full licence.