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High Gear Supports Competition Commissions Suggestions to Reduce Insurance Premiums

High Gear Supports Competition Commissions Suggestions to Reduce Insurance Premiums

The Competition Commission (CC) is a public body that ensures healthy competition between businesses in the UK is catered to. The market investigators have recently delved into the insurance sector, concluding that insurance premiums are too high. After a referral from the Office of Fair Trading (OFT) the Competition Commission wants to introduce mandatory standards, a project that High Gear really supports. One of our main aims at High Gear is to serve the public’s self-drive insurance needs and the best price possible. With many insurance companies they lure you in with a small price but with a huge premium, instilling a great fear in the driver After spending a year focusing on the industry they have arrived at ways in which improvements can be made, ensuring the customer receives a better deal, a mission that High Gear was created to achieve. They found that premiums were so high due to the insurer of a driver who was not to blame in an accident arranging for a replacement car or repair, but the at-fault driver's insurer pays the bill. This clearly shows a distinct separation with people the high prices of accidents having a detrimental effect on insurance quotes for those who have never had an accident in their life. "This separation of control and liability creates a chain of interactions which result in higher costs for replacement cars and for repairs being passed on to at-fault insurers," it said. "The Commission estimates the extra premium costs to be between £150m and £200m a year. "There is insufficient incentive for insurers to keep costs down even though they are themselves on the receiving end of the problem." The Commission will now consider ways to fix the market, with a final report published by September 2014. Such suggestions include a cap on the cost of replacement vehicles, or making an insurer of the not-at-fault driver responsible for providing the replacement vehicle. "These possible remedies are a further step along the road to getting a market that enables insurers to deliver fully for consumers," said James Dalton, of the Association of British Insurers (ABI). "We look forward to continuing to engage with the Competition Commission as it carries forward its work and we hope that this will lead to further improvements in the market and lower premiums for customers." The Commission believes that premiums could be reduced by £6 to £8 per policy if changes were made to the claiming process. Many ideas have been threatened in the past but as long as all organisations are on the same page with the same aim, the customer will benefit. High Gear supports any industry introductions as long as it serves a benefit to the customer. Share with us your thoughts on this…

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