Car insurance firm market probe

The Office of Fair Trading (OFT) is to refer the private motor insurance market to the Competition Commission for practices that, it claims, drive up the cost of premiums.

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'Dysfunctional insurance practices cost drivers £10 per policy'

Here are some statistics from the Office of Fair Trading investigation into dysfunctional practices in the motor insurance industry:

  • Practices cost insurers £225 million in 2011 - or £10 per policy for the consumer
  • Insurers get "kickbacks" of £250-400 from credit hire firms
  • Average cost of a courtesy car is £560 higher when the insurer of the not-at-fault driver chooses the supplier
  • Average cost of repairs was £155 higher when the insurer of the not-at-fault driver is in charge

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