Is Car Insurance Changing?
A good recent example of just how much insurance can change in a relatively short period can be found in the recent European Court ruling that required insurers to charge male and female drivers equally. Traditionally women have always paid lower premiums on their car insurance, because they are statistically safer drivers. However, this has now been ruled as sexual discrimination, which will have a significant impact on how future policies are calculated.
Whilst this is just one example, and a pretty major one at that, there are constantly tweaks that insurers must make in an effort to keep policies current and abide with any such rulings.
Another major influencing factor in the cost of car insurance is the vehicle itself. In recent years there has been a huge change in the automotive industry, with a push towards economical and environmentally friendly vehicles - such as hybrids or entirely electric cars.
The power of a car and the cost of replacement parts plays a huge part in policy calculations, therefore as we develop new designs, changes are inevitable. Those with the more powerful and expensive models will always be charged more, as they pose a greater risk to insurers and any claim is likely to be significant.
Conversely the cheapest cover will always be available for those driving low power, low value vehicles. This is simply because they are usually less desirable to thieves and aren't likely to be involved in any high speed collisions. Invariably, between the highest and lowest value vehicles the calculations become a little more complicated and subtle differences can have a major impact on the price of a policy.
But there are also cultural and geographical issues that can impact on insurance. For instance, certain areas will always cost more due to having a higher crime rate. This is simply because the likelihood of theft or vandalism, both of which could result in a significant payout for the insurer, is much greater. Invariably though, these can change in the course of time. Some will improve, others may decline; however, the primary concern for insurers is to have a car insurance policy that accurately reflects the latest figures.
The basic picture that we are now forming is that because society doesn't stand still, neither can the companies that offer insurance. It's a similar problem in health, life cover and even home insurance. The cost isn't static and neither are the factors that determine cost. Over the years, more cost factors may be employed, some removed and others changed significantly. This is just a by-product of a highly complicated industry and the processes involved.
So in simple terms, the simplest - and most accurate - answer to the question of whether car insurance is changing is a resounding 'yes'. There's no avoiding it, in fact it is inevitable. Insurers need to move with the times and ensure that their prices reflect the very latest data and rulings. Whilst the sexual discrimination act is one of the larger and more unexpected alterations to their calculations, it is a great example of just how quickly and decisively quotes can be adjusted to suit the latest figures.