insight INSURANCE


Van drivers take brunt of insurance hikes


R


esearch has revealed that van drivers are facing annual insurance price rises of 29.5%, the result in part of new


compensation rules and tax increases. Insurance market research specialists


Consumer Intelligence say their analysis shows that average bills are now £1,636, with prices soaring in the past three months as the decision by regulators to slash the discount or Ogden rate governing payouts in major personal injury claims to minus 0.75% from 2.5% came into effect. The increase in Insurance Premium


Tax at the start of June and rising claims costs are impacting particularly on self- employed workers relying on vans for work. Average premiums for van drivers are


nearly two-and-a-half times higher than for car drivers who pay an average £666, Consumer Intelligence’s quarterly Van Insurance Index shows.


TOLLS Severn Crossings toll to be scrapped


Tolls on the Severn Crossings will be scrapped by the end of 2018 when ownership passes from the Severn River Crossing plc to Highways England. The announcement came from Secretary of State for Wales, Alun Cairns, and brings to an end the highest toll charges on the UK roads network. It currently costs £13.40 for a van to cross into Wales. The bridges are used by more than


25m vehicles each year, saving significant travel time and distance for commuters and drivers using the M4 motorway.


Promise The government acknowledged that the tolls on both Severn Crossings have been seen as an economic and symbolic barrier to Wales’ future prosperity and scrapping the tolls was a pre-election promise. Cairns said: “The decision to abolish


the Severn tolls next year sends a powerful message to businesses, commuters and tourists alike that the UK government is committed to strengthening the Welsh economy.” Scrapping of the tolls was hailed a victory by the Freight Transport


Its analysis found drivers using their


vehicles as car substitutes suffer the biggest rises – average premiums for “social, domestic and pleasure” cover increased 33.5% in the year to June. Drivers relying on their vans for


work are regarded as a better risk – but premiums for “carriage of own goods policies” are still 28.4% higher in the year. John Blevins, Consumer Intelligence


pricing expert said: “The acceleration in insurance costs for van drivers is down to the Ogden changes in March with tax rises and claim costs adding to the pressure. “Before the Odgen rules came into


effect in March prices were rising by around 1% a month and then rocketed by 11.4% in April, with the Insurance Premium Tax rise in June adding another 2%. “Choosing the correct cover is vital and opting for carriage of own goods where appropriate will reduce premiums as will shopping around as prices vary


38% The rise in the cost of


van insurance premiums for the over 50s


Source: Consumer Intelligence


month on month and between providers. But unfortunately it seems the only way is up.” Average premiums for vans are more


expensive than for cars, as the cost of claim payouts is higher as insurance may have to cover lost business as a result of owners not being able to work and vans are generally more technologically advanced. The price difference between “social,


domestic and pleasure” and “carriage of own goods” is driven by insurers rating customers using vans for work as a better risk as they are more likely to be careful with their vehicle as it’s vital for work.


Association (FTA) which has spent 10 years lobbying for charges to be removed. Ian Gallagher, FTA head of policy for Wales and the South West, said: “We have fought long and hard on behalf of FTA members to get these charges removed. They represent a huge financial burden for logistics companies in the area.” He said that the two bridges spanning


the Severn estuary on the M4 and M48 motorways in Wales have seen year-on- year price increases, costing the sector millions of pounds. “The announcement heralds the death knoll of what are the most expensive tolls in the UK.” The Severn Bridge was built in 1966


and a second crossing was completed 30 years later.


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