Massive Difference Between Insurers’ Income & Payouts Revealed
Friday, 26. February 2016
Just to prove my point regarding my insurance premiums, law firm Thompson’s Solicitors, has produced a report that shows that over the past 5 years insurance claim payouts have decreased whilst premiums have increased allowing the insurers to pocket £7 billion since 2010.
In response the Association of British Insurers (ABI) has hit back claiming that Thompsons, a claims solicitors, are upset with Government plans to end the right to cash compensation for minor injuries like whiplash and to increase the upper limit for small claims court personal injury cases to £5,000.
Thompsons reported that premiums between 2010 and 2014 had dropped in real terms and motorists were paying less in 2014 than they were in 2010 but cumulatively premium income increased by £353 million whilst insurers saved £7 billion in payouts. There has been a net drop in the number of motor claims made of 4% but the net cost of claims incurred is down by nearly 30%.
The ABI refutes the claims made by Thompsons and suggest that savings of £1 billion have been passed on to motorists. Who’s right? I don’t know but I would suggest that much of the increased income is down to people not thoroughly checking their insurance renewals. By Graham Hill
