The ABI backs proposals from The Competition and Markets Authority (CMA) to further increase competition in the motor insurance market.
James Dalton, ABI’s Head of Motor Insurance, said:
"The insurance industry has supported the CMA investigation from the start and we welcome the CMA’s proposals which, if implemented, will help to reduce some of the unnecessary costs that insurers face and help lower premiums for motorists. They build on reforms being introduced to tackle fraudulent whiplash claims, which have partly led to the average comprehensive motor premium falling by 14% since the start of 2012.
"We urged the CMA to focus on the credit hire market, so we are pleased that they have proposed a cap on the prices that credit hire operators can charge to the insurer paying the bill for replacement vehicles. This will help reduce the often inflated bills from credit hire operators and should help lower premiums.
"We will continue to work proactively with the CMA and the Financial Conduct Authority to ensure that the motor insurance market continues to deliver the best possible service and lowest possible premiums to UK motorists.”
Commenting on the other CMA proposals, James Dalton said:
Banning restrictive price arrangements by price comparison websites (PCWs)
“These clauses prevent insurers from offering a cheaper deal to consumers through their own website or another PCW, so the proposal to ban them will be welcomed by consumers who want more options when shopping around for the best deal.”
Better consumer information on policy add-ons, such as no-claims bonus protection
“Customers need relevant and clear information to make an informed choice when buying their car insurance, and we will continue to work with the CMA and the FCA in their on-going work on insurance add-ons to further improve the information available to customers.”
Better information for consumers about their rights following an accident
“Being involved in a car accident is a stressful experience, and we will be looking closely at how guidance to consumers about their legal rights following an accident can be improved to ensure customers always receive the best possible service following an accident.”
Accident Repair quality
“Insurers always look to ensure the highest standard and quality of repair when dealing with customers’ vehicles. We welcome the fact that the CMA now recognise new rules are not required to deliver this."
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