Van drivers benefit from cuts to insurance

Published:  15 February, 2018

Van drivers are benefiting from cuts to insurance bills as price rises slowed and fell in the past six months, according to analysis from Consumer Intelligence.

Average premiums are now £1,202 after prices rose 20.3% in the year to the end of January, its quarterly Van Insurance Index found.

However, insurers have put the brakes on premium increases, with the slowdown picking up in the last three months when prices dropped by 3.5%, with nearly half of the fall in the past month.

The government u-turn on the discount or Ogden rate, which sets payouts for major personal injury claims, has enabled insurers to reverse rises, and confirmation of a rate of between 0% and 1% could mean more cuts.

However, a rise in the size of claims, partly driven by drivers owning more technologically advanced vans, as well as fraud and increased repair costs, means premiums are still rising year-on-year.

John Blevins, Consumer Intelligence Pricing Expert, said: “The market is returning to normal now the Ogden effect is wearing off, and it is possible we could see more cuts once the new rate is decided.

“But other market fundamentals remain the same with the weak pound increasing the cost of repairs when parts have to be brought in from overseas, and more advanced technology in vans driving up the cost of claims.

“The rise in Carriage of Own Goods premiums shows there are rising claim costs from customers using vans for their business, which may suggest some signs of a rise in fraudulent claims.”

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