Low Insurance Premiums could Rise Again says Aviva

Although there has been a recent price fall in insurance premiums, Aviva have stated that this is no time for the insurance industry to become lax.

Rob Townend, Aviva’s UK and Ireland claims director, said that despite the recent wins for the industry, insurers should not become complacent. Further legislation to tackle fraud needs to be brought in.

Recent changes include a restriction on lawyers trying to convince people to claim and better medical checks regarding whiplash claims. This has helped to bring down insurance payouts, and has finally seen the insurance industry make a collective profit for the first time in 20 years.

Premium prices plunged by 14.1 per cent in January, as a result of the government’s restrictions on claims transferred savings over to customers. “If you look at the last 12 months, you will find that the consumers are winning because prices are dropping and the insurance sector has also made some money” said Mr. Townend.

“The measures introduced by the Ministry of Justice have been a step in the right direction. But we cannot be complacent.

“Motor insurance is circular and it is competitive, people come in and out, and there are things that we can do as an industry to reduce premiums. But potentially premiums could come back up. It depends how we make sure the reforms remain in place because people will now be trying to work around the legislation.”

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