Author: News Desk

Postcode prejudice and redlining here and across the pond

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VAN INSURANCE NEWS ROUNDUP: 7 DAYS ENDING 25 JULY 2014:

If you’re looking for cheap van insurance, guess what: you could end up paying through the nose just because you’re in the wrong postcode, my friend.

Rumours have been swirling forever about how insurers use arbitrary reasons such as your postcode to decide if you’re going to be offered affordable van insurance or car insurance or if you’re going to be slapped with a massive premium price. Well, new research has revealed that postcode prejudice is real and factual: the worst postcodes for high rates just happen to be grouped in Birmingham.

Did you happen to see that Channel Four documentary called Benefits Street? It was about how the number of Brits living on or near James Turner Street on the dole are through the roof – and it turns out that living in close proximity to Benefits Street, whether or not you’re receiving benefits, practically guarantees you insurance premium pricing so high as to be eye-watering. More than 20 per cent of the worst 100 British postcodes for high car and commercial van insurance premiums are within a stone’s throw of James Turner Street, so it doesn’t matter how conscientious a driver you may be: your postcode has sealed your fate.

For what it’s worth, I find a practice like this completely reprehensible on the part of insurers. Sadly it’s all too common – and not just here at home. American insurers do exactly the same thing. When it comes to US postcodes – known as zipcodes across the pond – American insurers intentionally carve out high rate areas by grouping zipcodes with a high concentration of lower socioeconomic classes together and charging them rates that are much higher. It’s known as redlining within the industry, and it’s akin to institutionalised discrimination, especially since so many of these zipcodes are home to not just low-income Americans but minority populations as well.

Yet somehow all of this is legal and accepted, both in the US and at home in the UK. I don’t see how this could possibly be just, but I also don’t see anyone else drawing attention to it or complaining about it. Who’s going to stand up to these insurers and tell them they can’t victimise people in this manner?

Not even new DVLA database will save the white van man

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VAN INSURANCE NEWS ROUNDUP: 7 DAYS ENDING 18 JULY 2014:

The DVLA’s new database, which goes live next month, is rumoured to save every motorist as much as £15 on their insurance, but will it help the white van man?

When it comes to paying for car insurance or commercial van insurance, whatever drops premium prices is a good deal. Finding discount car insurance or cheap van insurance is always a challenge, and thanks to the new database linking to insurers directly, now a provider doesn’t have to take the word of drivers for granted when it comes to how many points they have on their licence – the information will be furnished to them directly. It will lead to more accurate premium pricing, and the average driver will save modestly on the cost of their cover.

However, whilst this new programme may have an overall positive effect on motorists’ wallets, cash for crash fraud is still a major problem in the UK – especially because van drivers are increasingly being targeted. New research released this week revealed how Birmingham is one of the worst places for car insurance fraud, and criminals have developed an insidious way to trick van drivers into getting into accidents deliberately.

The fraudsters are allegedly causing vehicles of all types to enter into a junction by flashing their headlights at them, ostensibly to give a silent signal to go ahead, only to then speed into them and orchestrate an accident they will then say was caused by the other driver. The scammer claims they never flashed their headlights, and when it’s one person’s word against another, most of those innocent drivers that end up getting tricked also end up getting the short end of the stick.

The result is a costly insurance claim against the innocent driver’s insurance company. This hikes rates for the van driver specifically and also ends up impacting all of us, as the more this fraud occurs the more insurers end up paying out to these criminals – and that leads to higher operating costs that need to be recuperated by raising rates across the board. Suddenly that £15 price drop from the new DVLA database seems less than useless doesn’t it?

At any rate, if you’re a van driver in Birmingham – or really anywhere, take it with a grain of salt if someone flashes their headlights at you whilst waiting at a junction. Like Admiral Ackbar likes to say, ‘it’s a trap!’

Cheap van insurance? Not if you live in Birmingham

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VAN INSURANCE NEWS ROUNDUP: 7 DAYS ENDING 4 JULY 2014:

Birmingham has been declared the worst place to get a good deal on your motor cover, whether it be car insurance or commercial van insurance.

If you think you’ll be able to buck the trend and get cheap van insurance if you live in or near Birmingham city centre, think again – new research has revealed the city is one of the absolute worst spots in the UK when it comes to car accident claims. Things have gotten so bad that the gap between Birmingham and Aberdeen  – the city with the cheapest insurance overall – is more like a yawning gulf; insurance is seven times cheaper in the northern city in comparison, and that’s no laughing matter in the least!

Things are so bad in Birmingham that it’s actually become bizarre and surreal. In fact just this week a news story broke about how police pulled over a very strange car on the M42, right near junction 4, after they saw its rear window was missing. It wasn’t just missing though – it had actually been replaced with a superhero-style cape that had been left to flap heroically in the breeze as the rather ratty-looking Peugeot 106 motored by.

Things got even more strange when the police actually stopped the vehicle, though. It turns out both the driver and the passenger were dressed up in Superman costumes. Yes, the Man of Steel and apparently his stunt double had decided to take a nice drive in a particularly conspicuous vehicle. It turns out that neither of the two blokes had proper insurance for the vehicle, so that was the end of that particular adventure for that pair of jokers.

It may seem like a harmless prank but driving without insurance is one of those things that drives up insurance prices for everyone – especially if these two pillocks would have ended up getting into a road traffic accident. Insurers have to shoulder the cost of uninsured drivers themselves, and that means increased costs for them; the knock-on effect is of course higher premiums for everyone. With Birmingham being the epicentre for this kind of behaviour it’s only natural that the city is the worst place to keep a vehicle when it comes to insurance costs.

Insurers raising rates left and right for virtually everyone

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VAN INSURANCE NEWS ROUNDUP: 7 DAYS ENDING 27 JUNE 2014:

No one is safe when it comes to increased vehicle insurance rates – in fact, new evidence shows that every single class of driver is getting hit hard.

While increased rates is nothing new for the white van man – commercial van insurance premiums seem to be spiraling ever upwards – now other types of vehicles owners are getting slapped with heightened car insurance premiums as well. In fact, classic car owners are the latest breed of drivers that are feeling the heat – even if your classic car isn’t even in fantastic condition.

New reports are rolling in that rates for classic cars are out of control. In fact just this week a story broke that one car owner’s Porsche 911S, which was valued at a measly £8,000 less than twenty years ago, is now valued at ten times its original estimate. That’s right, the same car that’s aged – and possibly not all that gracefully – over the course of eighteen years is now supposedly worth £80,000.

Do you know what that means for someone who ends up in an accident, but only has cover commensurate with their original £8,000 valuation? It means that if the damage exceeds that original figure, you’re out of pocket for the rest – and with the vehicle now valued so high this could mean tens of thousands of pounds that you would have to fork over to get your vehicle back in working order. It’s a bloody travesty if you ask me!

So what do I care, you may be asking. My van isn’t a classic car by any means. Well you may be right, but it’s not just classic car owners that are getting the piss taken out of them. Regular run of the mill car insurance and van insurance policies are becoming more expensive, and it’s all because the amount of fraud in the UK is supposedly going through the roof.

Think it’s just a bit of balderdash? Its not. Insurance giant Aviva said this week that the amount of fraud that they encountered last year was astronomical. In fact, more than 800 accidents – and the 2,200 personal injury claims that arose from those accidents – were fraudulent. These were of course only the faked auto crashes that they discovered; the true figure might be even higher. Whatever the actual number of car crash scams going on, it’s bad news for honest drivers because all the extra costs generated by fraudsters and then absorbed by Aviva and other insurers makes it more expensive for these companies to do business – and what does that lead to? Well, heightened premium prices of course!

Insurers hammered hard – will van drivers feel the ill effects?

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VAN INSURANCE NEWS ROUNDUP: 7 DAYS ENDING 20 JUNE 2014:

Whether it’s having to deal with rampant fraud or rumours of new regulations it will be facing soon, the car insurance and van insurance industry is reeling.

However, the true problem here when it comes to insurers being battered left and right is that there’s always the fear that regular Brits end up taking it on the chin in the form of heightened insurance premiums. Even using insurance comparison websites might not be much of a help if things keep going as they are, if you ask me – and that’s bad news indeed.

First of all, there’s new evidence from major insurer Aviva that the number of fraud instances are rocketing upwards. The insurer – which handles one out of every ten policies in the UK – said that it had uncovered more than 800 accidents that had been completely faked in order to create an opportunity for fraudsters to generate some undeserved income. These so-called ‘crash for cash’ accidents resulted in more than 2,000 claims – and that’s just the scammers they caught in the act!

Needless to say Aviva wants much harsher punishments for fraudsters caught red handed in order to discourage criminals from this behaviour. However, there’s hardly going to be much movement here – scammers will just get more and more crafty in order to keep defrauding insurers, and as the costs go up for insurance companies guess who’s going to pay the price? We are – with higher premiums.

Meanwhile some insurance companies may be in on the whole fraud thing, if you can believe that! The Competition and Markets Authority – the successor to the Competition Commission – is delving deep into reports that some insurers are drumming up excessive repair costs and charging their rivals for work done to repair cars. Signs are pointing to evidence that this is actually going on quite a bit; big surprise, eh?

Good news is that if the CMA decides to recommend new regulations to cap the amount of money insurers can charge each other for repair work, which should make it much easier for anyone with a car or commercial van insurance policy since in theory it should result in lessened costs. Of course this may not actually be the case once put into practice, as insurers can always find ways to line their pockets; if they can do it with our money then even better.

Overall vehicle costs down, but not for long at all

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VAN INSURANCE NEWS ROUNDUP: 7 DAYS ENDING 13 JUNE 2014:

There’s good news and bad news for you this week: while it’s true that the overall cost of keeping a vehicle on the road has gone down, this isn’t set to last.

Whether you’ve got a personal vehicle or you use a van or lorry for work, it can be a serious endeavour keeping your motor on the road. Between petrol costs, trying to find cheap car insurance or commercial van insurance, and the cost of maintenance and testing it’s a major expense. However, it looks like these costs have eased over the last 12 months according to new data released by the AA.

Overall costs dropped by around £300 a year for a vehicle of around £13,000 to £18,000 in value, which is most likely the average value of many cars used as daily drivers or vans used for work by tradesmen. It’s a minor drop, but it’s a welcome one for sure – an extra £300 may not sound like much, but that can go a pretty long way if you’re smart with your cash.

Of course, the good news is eclipsed by the bad news rather quickly. It turns out there are new fines that will be going into effect for many driving offences in the very near future, and the penalties are growing by leaps and bounds in comparison to the level they are now. For instance, right now while it’s possible you could end up paying a fine of £2,500 if you’re caught speeding on UK motorways, the new penalties see this maximum fine rise to an eye-watering £10,000!

Well that will certainly work as a deterrent. If I knew there was a chance I could get slapped with such a hefty fine, I’d sure as anything not deviate over the speed limit on any motorway I was on. Still, there will undoubtedly be a few white van men that get distracted behind the wheel and end up getting caught – it’s almost inevitable. With a sudden £10,000 penalty to pay, you’d better hope that other motoring costs keep going down!

What will drive the white van man off Britain’s roads first?

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VAN INSURANCE NEWS ROUNDUP: 7 DAYS ENDING 6 JUNE 2014:

So here’s what I worry about: will the cost of van insurance raise so high that it becomes unaffordable, or will technology kill the white van man first?

And let’s make no mistake – the cost of car insurance and van insurance is going to increase, especially if you look at the toll that fraud takes on insurance companies. In fact, a new study from the Association of British Insurers found that there was £811 million in fraudulent motor insurance claims last year, and that figure is just going up and up with no end in sight. This of course gives insurers a perfect excuse to raise rates for every one of its customers, whether they’re just motoring about in their Vauxhall Astra or if they have commercial van insurance to keep their business running.

Then again, I also wonder if rampant technological achievements are going to destroy the market for lorry drivers as well. The research into driverless vehicles is coming along at an astounding rate, and not just with companies like Google with their automated robot cars that drive about everywhere – a new report revealed that Milton Keynes will have driverless vehicles on its roadways by 2017.

So tell me: who’s going to need to work as a van driver if these vans can drive themselves? Not only that but who’s going to risk employing a fallible human driver when you can simply use a computer programme that will obey all traffic laws and drive much more safely than a person? At least they haven’t automated the process for loading and unloading vans and lorries yet – right now that’s still done by hand, even if you need a forklift truck to do the heavy lifting, there’s still a human element behind the wheel guiding it.

Of course the other downside is the same one you see in most Hollywood movies nowadays: with all these computer controlled vehicles, what happens if they end up networking together in some Skynet-like artificial intelligence and end up enslaving us all? How am I supposed to go down to the local pub if my car won’t let me in without talking sweetly to it and promising to get it washed that afternoon? Will there be a Ford Cylon coming out next year, complete with a malevolent, oscillating red light bent on the destruction of the human race? This why I don’t sleep at night any more.

Good luck to young van drivers on British roads

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VAN INSURANCE NEWS ROUNDUP: 7 DAYS ENDING 30 MAY 2014:

Think car insurance is hard to find for young drivers? Think about how hard it is to get commercial van insurance and your head will positively spin around.

Nothing is quite painful to a younger driver than finding a car or van insurance company willing to provide cover. It’s not necessarily anyone’s fault, either – younger drivers are statistically more likely to end up in an accident, and as a result insurers adjust their rate quotes accordingly (or not so accordingly) – but it’s becoming a lot harder for a younger Brit to get on the road nowadays.

Trying to find a good job when you’re young can be difficult – you don’t have much experience, and if you live in a location that has poor transport links you absolutely need your own motor to get to interviews. Of course you can’t afford a vehicle unless you’ve got a job, but you can’t get the job without a vehicle; it’s the ultimate Catch-22, one that younger drivers have had to break by going to the Bank of Mum and Dad for some funds.

Of course most parents are glad to help, but only to a point – the problem is that the cost of a first car – usually a used Astra or something similar – is much less than the insurance cover for that same motor. Things get even worse if you’re the entrepreneurial sort and you want to go into business for yourself; try finding a van insurance company that will give you a fair shake!

Of course, even if you do get on the road you have to worry about accidents. Believe it or not but a new study found that younger Brits have car accidents more often on rural roads than in cities – and that includes London! The biggest hotspot for accidents involving drivers under the age of 20 was found to be Dyfed Powys if you can believe that – the area had a casualty rate of 18 per cent for that age group, and that’s ridiculously high when you think about how the same age group only makes up about 1.5 per cent of drivers.

Best of luck holding on to your van insurance in the future

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VAN INSURANCE NEWS ROUNDUP: 7 DAYS ENDING 23 MAY 2014:

Nowadays it seems like there’s always an easy way to lose your van insurance or car insurance, but don’t worry – it will only get easier to do so in the future.

Right now car insurance companies have been looking for new and interesting ways to invalidate your cover, and they’ve found a new whipping boy: the practice known as fronting. It involves taking out an insurance policy on a vehicle, claiming to be the primary driver, and then actually letting someone else drive it the majority of the time whilst they are listed as a secondary driver in order to save them from taking out cover themselves. It’s quite common amongst families where children of driving age would have to pay through the nose for a policy of their own, but it can be used in almost any similar situation such as a contractor letting an employee motor about in the company van without having to pay an increased rate.

Well insurers are having none of that and have announced that they’re on the lookout for such behaviour. Being found out about your fronting is grounds for invalidating your car or commercial van insurance, so don’t get caught; the cost of trying to get cover after having that on your record is going to be much higher than the few quid you save by fronting in the first place. Never mind the fact that insurers ramp up their premium prices to practically criminal levels – do insurance companies think that they don’t have a bit of responsibility for the practice? Probably not, the arrogant bastards that they are.

Speaking of arrogance, a news report this week revealed how there are plans in the works at most major insurers to eventually transition to a more integrated telematics-based framework instead of the current model that’s in existence now. Now for what it’s worth telematics has its place – those willing to provide an insurer with their detailed real-time driving records in order to prove they’re not pillocks behind the wheel earn a discount for being safe drivers – but it’s an opt-in situation at the moment. Switching things around where telematics becomes the norm and any drivers that don’t want their every move recorded by a little satnav-like device under their dash will be penalised by higher rates hardly seems fair to me!

Then again nobody seems to care about the privacy implications of such a development, least of all insurance providers. All they’re after are ways to cut the cost of providing cover to consumers in order to maximise their profits so of course they’re going to ‘encourage’ motorists to switch over in droves. Meanwhile it’s just another nail in the coffin of your right to privacy. I hope those extra quid help you sleep better at night knowing that Big Brother’s watching you like a bloody hawk!

Does your insurer want nothing but your money?

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VAN INSURANCE NEWS ROUNDUP: 7 DAYS ENDING 16 MAY 2014:

New evidence is emerging by the moment that every single car insurance and van insurance company out there wants nothing but your money – big surprise.

All right so let’s get right down to it: insurance companies are run for a profit. They provide insurance services to consumers, who then pay for the privilege. Car and van owners gain the security of knowing their vehicle and its contents are insured against damage or theft, and insurers make money off the premiums their customers pay.

But are insurers charging us fairly? It seems not – especially when you take into account that if you live in a particular geographical area such as, oh I don’t know, perhaps an open prison, your rates skyrocket. Think I’m making it up? Well I’m not – it’s exactly what’s happening to the residents of Sudbury, despite the fact that the accident rate in the town isn’t any higher than anywhere else nearby.

Insurers swear up and down that they’re not taking the open prison into account, but I don’t believe them. You’re telling me these poor Brits just naturally pay more than those in the town over, even though accident and crime statistics are virtually identical? Bollocks, I say.

If you need more proof though, I’ve got what you’re looking for. Did you know that loyalty means nothing to the average car or commercial van insurance provider? How can I say that? Well, it’s obvious – every time you renew your insurance for another year, I’ll wager your premium goes up slightly.

New statistics back me up on this one too – an insurance comparison site found that motorists that don’t shop around every year end up overpaying on their insurance by nearly £2 billion altogether! Don’t let these insurers get away with that; make sure you shop around every year and find the best deal for you. I mean there’s operating your business to make a profit and then there’s over-charging your customers on purpose in order to maximise your own gains, and the latter is just plain wrong no matter how you slice it.

 

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