Aviva - chief exec Mark Wilson comments on CMA report: "failed to grasp the key issues affecting UK motorists"

Written by Mark Wilson, group chief executive of Aviva and published in Saturday's Telegraph:

The Competition and Markets Authority (CMA) failed to deliver badly needed reforms to the motor insurance market this week following a two year investigation.

The remedial actions contained in their final report amount to very little in meaningful change.

The CMA missed the chance to tackle the fundamental issues affecting UK motorists and the market – with its millions of pounds of unnecessary costs – rolls forward.

Sadly, the CMA investigation had a flat tyre before it hit the road.

The review failed to grasp the key issues affecting UK motorists.

If we look at the major challenges facing the market – whiplash claims, fraud and escalating legal costs, to name a few – the scope of the investigation was inadequate.
This led them to ineffective remedies, some of which they discovered they did not have the authority to implement; inevitably the UK's motorists were left feeling underwhelmed.

I believe the CMA should have been able to review the motor claims process as a whole, a system of spiralling costs which prioritises financial compensation and encourages exaggerated and opportunistic personal injury claims.

Let's call this culture of exaggerated claims what it is. This is fraud. It is not a victimless crime. The cost of motor insurance for law-abiding motorists is driven up as a result.

The Government has shown some appetite for starting to deal with the problems of fraud, whiplash and rogue claims management companies and that's to be commended.
Motor insurance premiums have fallen sharply - down 14 per cent since 2012 – a welcome relief when household budgets have been under so much pressure. But we must stop nibbling at the edges and start taking real bites out of the challenges facing the motor insurance market.

Aviva has put forward wide ranging yet clear and achievable reforms to cut annual premiums by a further £50, equivalent to another 14pc on average for every driver. We want to see a legal system and laws which lead to long-lasting and meaningful reductions in the price of motor insurance.

The CMA failed to address referral fees in car hire and repair claims.

Aviva believes all forms of referral fees should be banned.

These are commonly paid in exchange for details about accidents so that the car hire firm, garage or recovery agent can attract work associated with the claim.
They add a significant level of cost into motor claims, but from a customer's point of view, they add nothing.

Third parties such as some claims management companies see motor claims as an opportunity to profit at the customer's expense. They line the pockets of companies who profit from motor claims, adding around £200 million, or £7 per policy, to the cost of motor insurance, with no tangible benefit to the customer. This is not equitable for consumers and it must change.

Secondly, we need to put the brakes on the UKs compensation culture. Weak regulation of motor claims and poor industry practice has encouraged high claims costs and fraud – much of it from organised crime. The bottom line is increased costs to consumers. Collectively, insurers, personal injury lawyers, claims management companies, the regulator and Government must sort this out.

Last year 94pc of all personal injury motor claims paid by Aviva in the UK were for minor injuries such as short-term whiplash. Compare this to France where whiplash accounts for only 3% of motor injury claims in France.
The UK does not have the weakest necks in Europe. But it does have weak laws and regulations governing personal injury claims and rogue claims management companies.

Aviva recommends reforming the current system which pays cash compensation for minor whiplash injuries, to one that purely focuses on treating victims' injuries and helps them return to health. Whiplash is a genuine injury which can cause significant pain and discomfort. So we want to put care, not cash, at the heart of the injury claims process.

Treating short term minor whiplash injuries with rehabilitation and care instead of cash would remove £900m from claims costs, saving motorists around £32 on the average annual premium.

Finally, if we are serious about tackling this issue, we must look at the legal system which allows exaggerated claims to flourish.

For every £1 Aviva pays out in personal injury compensation in the UK, another 77p in legal fees goes to lawyers. Many claims are straight-forward cases for minor injuries where lawyers are not necessary - restricting them to cases where their expertise is needed could save £300m, or £11 per policy.

Aviva will continue to make the case for change. We are building cross industry consensus. Customers, brokers and insurers want to see the cost of motor insurance reduced.

The CMA had an opportunity to fix the system and it didn't. The responsibility now passes to insurers and the Government.
We cannot afford to waste more time talking about the problems instead of tackling them. Now is the time to overhaul the system to put motorists' interests first.

Bradford 'ghost broker' jailed for fraud by false representation and forgery

Atique Khan, a ghost broker, based from Bradford, has been jailed for promoting invalid car insurance to motorists across the city.

Khan, 33, posed as motor broker and for 5 months to December 2011, when he defrauded both First Central and his clientele - selling false policies to over fifty drivers.

He obtained true policies from First Central, by delivering the insurer with false information and forged no claims paperwork to get premiums at a cheaper price tag.

He then charged drivers more than the premium, plus a managing fee, for insurance that was immediately invalid due to the misinformation.

The scam was exposed in January 2012 when Initial Central discovered all of the policies incorporated identical email addresses, and referred the situation to the City of London Police Insurance Fraud Enforcement Department (IFED), which launched a criminal investigation.

Khan was arrested at his home in the Queensbury district of Bradford, in which officers seized numerous insurance documents, £1,000 in cash, a computer, laptop, 2 iPads and many mobile phones, on which forged no claims documents were found.

In court in March, Khan pleaded guilty to 5 counts of fraud by false representation, 14 counts of utilizing a forged article and one particular count of possession of criminal residence, and he was this morning jailed for 12 months.

DS Mark Forster, who led the IFED investigation, stated: "Khan devised a car insurance scam that saw him ruthlessly target members of his neighbourhood to make thousands of pounds.

"He left his victims unknowingly out on the street with no insurance, exposing them and other drivers to risk and economic loss, but now the court has ensured he will pay out the cost for his fraud."

http://www.motorworldarc.co.uk/news.asp

AA - over 166,000 people used the AA website to get a car insurance quote on Xmas Day last year

Thousands of bored Brits will be shopping for car, home and travel insurance on Christmas day if statistics from AA Insurance are anything to go by.

According to the broker's online statistics, last Christmas nearly 200,000 people obtained quotes for insurance on Christmas Day with nearly 300,000 getting their quotes on Boxing Day.

According to the AA on Christmas Day alone, over 166,000 car and 32,000 home insurance quotes were provided while 141 people sought travel insurance.

Those figures rose to 242,000 car insurance quotes and 46,000 home insurance quotes being provided on Boxing Day.

Simon Douglas, director of AA Insurance says:

"My Christmas is pretty busy and I wouldn't have the time or the inclination to sort out insurance. But I can understand arranging travel cover if a holiday was given as a gift, although it seems odd that people might want to fix their car or home cover on Christmas Day or Boxing Day.

"But then, may be thousands of people looked out of the bedroom window on Christmas morning to find a brand new car with a giant ribbon tied round it!"

As to home insurance, Simon Douglas speculates that a near miss in the kitchen or an accident with a candle led some families to realise that their home insurance might not be adequate.

"It's also possible that receiving a costly gift might lead some people to suddenly realise they aren't insured, along with the rest of their possessions, and decide to do something about it. Or all these online applications might simply mean that people are trying out their new tablet!"

In addition, 94 people applied for home emergency cover on Christmas day while a few downloaded legal documents – including a comprehensive guide to writing a will and guidance on sorting out a building dispute.

AA quotes issued at Christmas 2012:

Car Insurance:
- Christmas Day - 166,415 quotes
- Boxing Day - 241,747 quotes

House Insurance:
- Christmas Day - 31,854 quotes
- Boxing Day - 46,455 quotes

Travel Insurance:
- Christmas Day - 151 quotes
- Boxing Day - 323 quotes

http://www.motorworldarc.co.uk/news.asp

Competition Commission warned ruling against "best offer" clauses would "rewind" motor insurance by 10 years

Price comparison website Compare the Market hopes the Competition Commission's will leave "most favoured nation" clauses untouched in review of private motor insurance.

Ahead of the Competition Commission (CC) publishes their provisional findings, which has been delayed again as reported by News from ABP on Friday, Paul Galligan, the managing director of Compare the Market, has warned the market would "rewind" by up to 10 years if the CC rules against controversial "best offer" clauses that are insisted upon by price comparison websites (PCWs).

The Sunday Telegraph outlined the scope of the investigation, which has extended to also look at motor insurance PCWs after requests from insurers who are angry about "most favoured nation" (MFN) clauses. The MFN clauses stipulate that insurers have to offer their "best prices" in order to for their premium quotes to appear on PCWs.

However, Mr Galligan, whose firm has attracted particular anger for insisting on "wide" MFN clauses, defended the practice.

He said they are essential to the effective operation of price comparison sites and vowed that Comparethemarket.com would fight for their continued use.

"We know these clauses have made us unpopular in the marketplace with insurers," he said. "But, if you're going to appear on Comparethemarket, we expect your very best price. As a price comparison site, I can't possibly imagine a time when we could compare anything but.

"If you look at some of the language and hype that surrounds these clauses, the legalistic jargon and the arguments between insurers and the Competition Commission, there's a real risk that the needs of the consumer get lost.

"Without these clauses, the market would rewind eight, nine or 10 years and lose a lot of the transparency we've brought to bear. It would be a massive step backwards."

"Narrow" MFN clauses mean that insurers whose premiums are quoted on PCWs can only offer the same or higher rates on their own websites.

However, Comparethemarket is unusual in insisting on a "wide" MFN clause, forbidding insurers from offering a cheaper price anywhere in the market.

"We're not the focus of this investigation but I think we have the most proactive stance and that's something we're going to maintain," said Mr Galligan.

"We're confident the commission will see through a lot of the bluster and hype and realise that if these clauses are done away with, there's only one winner – the large insurers. And only one loser – UK consumers."

PCWs are now estimated to be used by more than half of UK consumers seeking new insurance quotes.

http://www.motorworldarc.co.uk/news.asp

IFB (Insurance Fraud Bureau) - proposes 3 point plan for tackling rogue claims management companies

Speaking at a Westminster Legal Policy Forum event exploring the future of claims management regulation today, Director of the Insurance Fraud Bureau (IFB), Ben Fletcher, outlined a three point plan for tackling rogue Claims Management Companies (CMCs) involved in organised insurance fraud.

Claims Management Companies have long been common enablers of "crash-for-cash" fraud investigated by the IFB, with 53% of live police Operations assisted by the Bureau focusing on a suspected rogue Claims Management Company.

Whilst Fletcher recognises there is no "silver bullet" that will eradicate the problem, continued collaboration between the insurance industry, police and regulators, is deemed essential.

Fletcher outlined 3 measures to complement and enhance that work:

1 - Greater onus on front end checks for Claims Management Companies to prevent unscrupulous businesses being authorised to trade in the first place;

2 - Claims Management Companies themselves proactively sharing intelligence with the IFB about suspected fraudulent behaviour;

3 - Make disclosure of the referral source within the claim notification form a mandatory requirement.

Ben Fletcher, Director of the IFB – a not-for-profit agency tasked with investigating and disrupting organised motor insurance fraud – said:

"Whilst many Claims Management Companies are genuine, we know from years of operational experience that some are set up by criminal gangs solely to mask organised insurance fraud.
The 3 measures we are proposing will help us identify them, prevent them from posing a severe financial risk to our industry, investigate them and bring fraudsters to justice."

Case study: Claims Management Company boss jailed for 7 years

In August 2012, CMC boss Masi Naqshbandi was found guilty of staging hundreds of road traffic accidents in order to make insurance claims, which would have been worth over £6.5 million. Naqshbandi was sentenced to seven years in prison. (See ABP News of 7 August 2012)

Between 2007 and 2008, Naqshbandi and his accomplice, Sabaoon Hillaman, submitted over 250 fraudulent insurance claims through their London-based claims management company – Real Accident Helpline.

In some cases, vehicles were deliberately crashed or damaged to mimic a road traffic accident.
In other cases, accidents were entirely made-up by presenting false names and paperwork.
In all cases, credit hire, personal injury and inflated damage costs meant each claim was
worth tens of thousands of pounds.

http://www.motorworldarc.co.uk/news.asp

Ministry of Justice (MoJ) - announces further measures to clamp down on 'whiplash fraudsters'

Justice Secretary Chris Grayling is today announcing measures to help motorists to cut the cost of running a car including:

- a crackdown on whiplash fraud
- a freeze on MOT test prices
- a scheme designed to reduce the cost of fuel at motorway service stations,

Average motor insurance premiums have already fallen by more than 12% over the past year, equivalent to an £80 reduction on an average policy, thanks to Ministry of Justice reforms to no-win, no-fee deals and action on rogue claims firms - according to new statistics from the AA.

Justice Secretary Chris Grayling said:

"We are turning the tide on the compensation culture and helping hardworking people by tackling high insurance premiums and other motoring costs.

"It's not right that people who cheat the insurance system get away with it while forcing up the price for everyone else - so we are now going after whiplash fraudsters and will keep on driving premiums down."

He has announced today that:

. Whiplash cheats, whose bogus compensation claims have helped to force up average motor insurance premiums, will be targeted by new independent medical panels which will ensure only evidence from accredited professionals can be considered.
This will mean people can no longer profit from exaggerated or fraudulent compensation claims but victims with genuine cases can still get the help they deserve.
These will be introduced from next year.

. The statutory maximum price of the MOT test for a car will be frozen at £54.85 until 2015 - potentially saving up to £50m for drivers every year.

. Action will be taken on high motorway fuel prices. New comparison road signs will be trialled which will show prices at different service stations along a route, making it easier for drivers to get the cheapest deal and encouraging competition on prices.

. The fees charged for the driving test will be reviewed, including the current £31 for the theory test, £62 for the practical test and £50 fee for the provisional licence, to identify any opportunity to save money for the 1.5m car drivers who take their test every year.

Roads Minister Robert Goodwill said:

"The costs of owning and running a car are felt by millions of households and businesses across the nation. The Government is determined to help keep those costs down. That is why we are freezing the price for an MOT test and looking again at the costs associated with getting a driving licence.

"We also want to make it easier for people to get a better deal on fuel at motorway service stations, for instance through a trial of motorway signs that will show motorists the different fuel prices on offer on their route."

New statistics from the AA show that motor insurance premiums are now falling at the fastest rate since 1994 - a fall of 12.3% in the year to October for an average comprehensive insurance policy, from £648 in October 2012 to £568 in October 2013.

New figures from the MoJ's Claims Management Regulation unit also show that the number of claims firms in the market has plummeted by more than 1,000 following the law changes, from a peak of 2,553 in December 2011 to 1,485 last month. The firms are responsible for bombarding the public with adverts for profitable compensation claims.

Despite these successes whiplash claims remain an issue which Government will continue to fight. The number of claims has fallen since 2011 but there were still almost half a million whiplash claims in 2012.
Insurers say these claims cost them more than £2bn in payouts and lead to an average premium increase of £90 for drivers.
Each whiplash compensation payout costs an average of £2,400 insurers say, with an additional £2,000 in legal costs.

The Government will now work quickly with experts to implement the independent medical panels.
This will include developing a scheme for accrediting medical experts who can assess whiplash injuries, enhancing the medical reporting process, improving information for medical assessments and carrying out spot checks to ensure quality.

Plans for improved data sharing by insurers will also help police, including the specialist Insurance Fraud Enforcement Department, to track down criminal fraudsters.

Prime Minister David Cameron pledged action to tackle high insurance premiums following a summit with the insurance industry in February 2012, where insurers committed to pass on savings to their customers.

Since then the Ministry of Justice has:

. Transformed no win, no fee deals so lawyers can no longer double their fees if they win, at the expense of defendants and their insurers.

. Banned "referral fees" paid between lawyers, insurers, claims firms, garages and others for profitable claims - which have driven the growth of compensation culture.

. Reduced by more than half the fees lawyers can charge insurers for processing basic, uncontested claims for compensation for minor injuries suffered in road accidents - from £1,200 to £500.

. Banned claims firms from offering cash incentives or gifts to people who bring them claims. Recommend a friend deals also banned, along with contracts agreed only over the phone.

http://www.motorworldarc.co.uk/news.asp

Uninsured driving - police make £218,000 profit from selling-off uninsured Lamborghini Aventado

Police made a tidy £218,000 profit today after a seized Lamborghini Aventador was auctioned off when the owner failed to come forward to claim it. 

ABP carried the news on 3 October that the car had been seized after being stopped in Newham, East London aspart of Operation Cubo, an on-going Police action to crack down on uninsured vehicles.

The Lamborghini was stopped because its front number plate was missing, causing police to carry out further checks when they discovered that the driver had no insurance.

When the owner failed to provide the correct paperwork, the car was put up for sale at Manheim's in Colchester.

http://www.motorworldarc.co.uk/news.asp

27 arrested in 'ghost broking' fake car insurance scams

Twenty-seven people have been arrested in dawn raids across the country by detectives investigating the sale of fake car insurance policies, a practice commonly known as 'ghost broking'.

Twenty-eight warrants were executed in the Leicestershire, London, Manchester, Thames Valley, West Midlands areas early this morning (Wednesday 9 October 2013), in a police day of action that marks the culmination of months of investigation by the City of London Police's Insurance Fraud Enforcement Department (IFED).

One hundred and sixty-eight officers took part in the operation, with the City of London Police unit supported by colleagues from the force's Economic Crime Directorate as well as officers from Greater Manchester, Leicestershire, Metropolitan, Thames Valley and West Midlands police forces.

Ghost brokers often target young drivers by offering cheap deals but anyone who buys one of their policies will find themselves driving without insurance, which could lead to their car being seized by police, fines, penalties and a criminal record. Uninsured drivers will also have to pick up the bill for any damage or injuries they cause in a crash.

IFED has already brought to justice ghost brokers who have tried to sell or sold cheap fake car insurance policies online, using phony websites as well as genuine classifieds and social media websites. The unit has had reports of ghost brokers operating in communities, approaching people in restaurants and internet cafes as well as on university campuses.

DCI Dave Wood, Head of IFED, said: "This day of action reveals ghost broking to be a UK-wide problem which is being met by a national law enforcement response, led by IFED.

"The consequences for innocent motorists who fall victims to ghost brokers can be dire, so it is absolutely vital that drivers shopping for car insurance online, or through other means, question what they are being offered to ensure they get a real deal.

"Driver diligence, coupled with enforcement action being taken by IFED and supported by local forces, is the best way to confront this threat now and in the future."

Advice for drivers on how to secure the cheapest legitimate policy possible is available on the
Association of British Insurers' website.

Anyone who believes they have fallen victim to insurance fraud should contact Action Fraud.

Information on suspected ghost brokers can be reported confidentially through the Insurance Fraud Bureau's Cheatline, powered by Crimestoppers, on 0800 422 0421.

Arrest breakdown across the police force areas as follows:

.  Greater Manchester Police = 3
.  Leicestershire Police = 1
.  Metropolitan Police = 9
.  Thames Valley Police = 3
.  West Midlands Police = 11

The precise offence the 25 people were arrested on suspicion of is fraud by false representation. One person was arrested on suspicion of burglary and another was arrested on suspicion of immigration offences.

http://www.motorworldarc.co.uk/news.asp

Over 2 million motorists carry out of date licence

There are over two million motorists in the UK who are currently driving with an out of date driving licence.  Most drivers believe that their new style licence is for life but the licence actually expires after a set period and has to be renewed, in fact photocard licences must be renewed every ten years.

It is a good idea to dig your licence out and do a quick check and avoid a £ 1000 fine. There are a few dates printed on the photocard, but the one you are looking for it the photo expiry date printed on section 4b on the front of the card.  If you find it is out of date then you need to renew it, the process is the same as if you were replacing a lost or stolen licence, you can either apply online, providing you've a had a new digital passport issued in the last five years (it'll use the same photo as on your passport), by post or in person at selected post offices (this does incur an extra cost of £ 4.50 on top of the £ 20 fee).

Check name and address

When checking that date on your licence also check that you have the correct address on it. It is free to change your address and you still risk the £ 1000 fine if it has not been updated. It has been reported that over 2.6 million motorists have not updated their driving licence with their current address and 3% of married women had an out-of-date name on their licence, which can also incur a £ 1,000 fine.

The first batch of ten year photo licences was issued in July 1998 so if you received your licence that year your licence will most certainly be out of date.

The DVLA state that drivers are allowed to continue driving if they have failed to renew before the expiry date but they ‘could’ be charged with ‘failing to surrender their licence’ which is an offence carrying the  £ 1000 fine.  The Association of British Insurers and the Department of Transport said that insurance cover was not affected if drivers failed to update their photocard. It's also worth noting the DVLA advises any driver travelling abroad to carry a photocard licence, rather than the older all-paper version, whilst this isn't obligatory, it may make your journey easier where required.

- See more at: http://www.motoring.co.uk/car-news/over-2-million-motorists-carry-out-of-date-licence_57847#sthash.sd595zDh.dpuf

HPI - warn that they check 625 cars a day which are revealed to be an insurance write-off

HPI urges used car buyers to protect themselves against the threat of purchasing a potential death trap masquerading as a bargain.

One in 33 vehicles checked by HPI, in 2012, was an insurance total loss - otherwise known as a write-off.

This equates to 625 cars a day or over 223,000 cars per year being dangerously repaired and sold on to unsuspecting consumers.

Don't take the risk, warns HPI, get a vehicle history check, such as the HPI Check to confirm if a vehicle has a hidden past.

All vehicles that are written off are put in to one of four categories, depending on the level of its condition.
The categories include cars that can be repaired and returned to the road, or ones that are recommended to be totally scrapped and never allowed back on the road again.

It is not illegal to repair or return 'written off for salvage' vehicles back to the road as long as the seller declares the facts and provides evidence that the car has passed a Vehicle Identity Check (VIC).

However, says HPI, a lack of good quality second hand cars for sale, means unscrupulous sellers are using a variety of ways of conning used car buyers out of their money.

Daniel Burgess, Managing Director for HPI explains,

"Criminals continue to capitalise on a shortage of used cars for sale by disguising write-offs as a good buy.
It's all too easy to be taken in by shiny paintwork and a low price, but it could be hiding a multitude of faults that haven't been fixed.
Unscrupulous vendors will sell a write-off to make a quick profit but if the vehicle is not properly repaired any price is too high."

An HPI Check will give a used car buyer the complete picture of a vehicle's history, including revealing if the car has been an insurance write-off and if so, which category.
This offers protection from paying good money for a vehicle that is not fit for purpose and a possible safety risk.

Daniel Burgess concludes,
"A check against HPI's registers will tell you if the car has ever been written-off.
However, we recommend that anyone looking to buy a car that has been declared an insurance write-off should seek to have it independently checked by Autolign or Thatcham to ensure that it is in fact road worthy before they part with their cash."

The ABI Categories of 'Write off'

Category A

Scrap only - i.e. with few or no economically salvageable parts and of value only for scrap metal e.g. total burnouts. These vehicles should not appear on the road.

Category B

Break for spare parts if economically viable. These vehicles should not reappear on the road.

Category C

Repairable total loss vehicles where repair costs exceed the vehicle's pre-accident value.

Category D

Repairable total loss vehicles where repair costs do not exceed the vehicle's pre-accident value.

The HPI Check includes a mileage check against the National Mileage Register (NMR) as standard, now with over 160 million mileage readings.
HPI also confirms whether a vehicle is currently recorded as stolen with the police, has outstanding finance against it or has been written-off, making it the best way for consumers to protect themselves from fraudsters looking to make a fast profit.

In addition, the HPI Check offers a £40,000 Guarantee in the event of the information it provides being inaccurate, offering added financial peace of mind to used car buyers.

- All cars written-off, excluding Category D write offs, must pass a Vehicle Identity Check (VIC) with the Vehicle and Operator Services Agency (VOSA).

- Insurers notify the DVLA of all cars 'written off' within salvage categories A, B, C and D.

- This notification will set a 'VIC marker' against the DVLA vehicle record for Category A, B and C write-off.

- While a VIC marker remains set, DVLA won't issue a registration certificate V5C, or vehicle license reminder V11.

- VOSA carries out the VIC which is designed to confirm the car's identity, not its road worthiness.

- This helps to ensure that the genuine car is returned to the road in a bid to reduce the problem of ringing - when stolen cars are given the identity of a written-off vehicle.

- The VIC marker will only be removed when the car passes a VIC test by VOSA.

Car park scratches cost UK drivers £500 million

Parking spaces that are too small are costing motorists over £500 million a year in repair bills for damaged paintwork.

A new study from Halfords and paint renovation experts G3 Pro has revealed that over 10 million car owners have suffered annoying scuffs or scratches as a result of unwanted contact in car parks over the past year – with two thirds of them having to pay more than £50 to fix bodywork.

Car doors are the most likely area to suffer scrapes as a result, accounting for 50% of reported damage, followed by bumpers (14%) and wings (13%).

Halfords paint protection expert David Howells said: "There is a squeeze on the nation's car parks and the consequences are hitting frustrated motorists in the wallet.

"The majority of drivers we questioned blamed their scratches and repair costs on inconsiderate drivers parking too close to them but our research shows that the size of parking spaces is leaving them little choice."

Despite the size of the average car growing – as manufacturers strive to offer more interior space, crash protection and comfort - Transport Department rules governing car park space sizes have remained the same since 1994.

The width of cars has increased by around 16% over the same period, making the average British car 2 inches wider than the 1.80m (5ft 11in) minimum parking space - that's 40mm smaller than a Ford Focus* and incapable of accommodating a BMW 3 series measuring over 2metres (6ft 7in).

Donna Howard from G3 Pro said: "Even the smallest scratch can be very annoying and reduce the value of a vehicle by hundreds of pounds. But with car park operators looking to maximise visitor volumes and revenue, there is little incentive for them to exceed the recommended minimum size requirements."

The research found that supermarkets were reported as the worst offenders by 38% of drivers, followed by shopping centres (29%) and railway stations (18%).

Donna Howard added: "Until drivers learn to take greater care of how they park, as well as how they open car doors in tight spaces, G3 Pro offers a range of professional quality products that can help banish unsightly scuffs and scratches to leave paintwork looking like new."

Trial underway of team of fraudsters who sold bogus car insurance from a fake call centre

Prosecutor Ann Mulligan said, "It was a fraud factory. There were printers, faxes, telephones, bank cards, chequebooks, mobile phones, shredders.

Bukharee had realised the earlier websites were under investigation and had decided to set up a new campaign."

A total of £40,733 had been paid by 38 customers for car insurance in the three weeks the First Direct website was up and running, the court heard.

Miss Mulligan said: "The case involves a ghost brooking website fraud - a website created for the purposes of fraud.

"It is not in dispute that this was a sophisticated fraud and it was masterminded by Danyal Bukharee.

"He used the four ghost broking websites to carry out car insurance fraud. He was responsible for setting up the websites, each of them purporting to offer genuine motor insurance at around a 15 per cent discount below the average price offered by genuine companies.

"Unsuspecting members of the public were duped into buying this non-existent car insurance and paying money for it.

"What he identified was he could target innocent members of the public, in particular young first time drivers for whom insurance premiums are extremely high, often inhibitively so."

It is claimed Bukharee recruited Giovanni Recchia, 47, to run the First Car Direct fraud from the flat by answering phones and dealing with customer enquiries.

Recchia was with Bukharee when police arrived at the flat and acted as a witness to the tenancy agreement, the court heard.

Detectives found a whiteboard featuring the names of nine invented employees next to their roles in claims, admin and compliance, it is claimed.

One victim remembered being put through to David Wood in sales and offered a quote of £2,018 for insurance, jurors were told.

Miss Mulligan said: "You may think Bukharee has a sense of humor. Detective Chief Inspector David Wood is in fact head of the Insurance Fraud Enforcement Department."

Police also found an iPod connected to sound system with only one track uploaded titled 'Office Noise.'

Jurors heard Recchia is likely to claim he was an innocent dupe and was led to believe this was a genuine business.

"Recchia cannot have failed to be aware that something was amiss," said Miss Mulligan.
"Using a name that wasn't his has to have alerted him to the fact this was a fraudulent enterprise."

Andrew Goward, 38, Gary Heaven, 37, and Mohamed Saleh, 26, were recruited to open bank accounts to receive the money paid in by the victims, it is claimed.

"Once these were opened Bukharee would take over control of the accounts to enable him to access the money," said Miss Mulligan.

"These three men may not have known it was a car insurance fraud specifically but what the Crown say is that at the time they opened bank accounts they did so in circumstances such that it can safely have been inferred they must have known or at the very least suspected they were doing it for criminal purposes."

Goward is said to have received proceeds from the Astuto Insurance and Car Insurance Warehouse between May and August 2011.

Heaven and Saleh are said to have received the proceeds from the Aston Midshires Insurance fraud between August 2011 and January 2012.

Buckharee, from Putney, south London, has admitted two counts of fraud by false representation and three counts of money laundering.

Recchia, from Retford, Nottinghamshire, denies one count of fraud by false representation.

Heaven, from Tulse Hill, south London, Goward, from Nottingham, and Saleh, from Greenford, north west London, all deny money laundering.

Gocompare - cost (followed by quality of cover) are biggest reasons for drivers choosing a car insurer

Cost is the key driver for 75% of Brits when choosing a car insurance policy, while just over half are influenced by the quality of cover being offered.

The research into factors influencing motorists' choice of car insurance policies, commissioned by Gocompare.com, revealed that in addition to the price of the policy, drivers were concerned about the level of cover on offer and the insurer's reputation, particularly in the relation to paying out for claims.

Reason for choosing car insurance provider:

1 - 75% said cost

2 - 51% said quality of cover

3 - 33% said insurer's reputation

4 - 32% said "I trust the insurer to pay out if I need to claim"

5 - 28% said the ability to pay in monthly installments

6 - 21% said "if I get a good deal (e.g. 11 months cover for the price of 12, second vehicle discount, free gift)"

7 - 12% said recommended by friends and family

8 - 5% said specialist provider (older/younger/ women drivers, sports/classic cars)

9 - 4% said recommended by an insurance broker

10 - 2% said "I like their advertising!"

Scott Kelly, head of car insurance at Gocompare.com, commented:

"For many drivers insurance represents a significant part of the cost of running a car, so it is no surprise that cost is an important consideration in choosing an insurance policy.
"
However, we would suggest drivers not pick a policy based on price alone, but to also think about the level of cover they need.

A number of insurers include additional features, such as a courtesy car, breakdown cover or legal assistance as standard, but some insurers offer these as optional extras.
So before signing up to a policy you need to think about the level of cover you need and whether you could buy it cheaper elsewhere. For example, breakdown cover is frequently offered as an additional extra with car insurance, but may be cheaper bought as a separate, standalone policy.

"Our research found that for some people special offers or the ability to spread the cost of their insurance by paying in installments are important factors when buying insurance. But motorists should consider the full cost of what they are being offered, bearing in mind that many insurers charge a fee for paying monthly."

Which? - The surprising factors that are driving up car insurance premiums

New Which? research reveals that parking your car in a garage, having children and being divorced or unemployed can all increase the cost of car insurance.

We found:

.  Direct Line quoted up to 22% more if you're unemployed, compared to our default occupation of researcher.

.  LV was the most price-sensitive to occupation quoting brewery workers and private investigators up to 23% more, and a bar manager almost 28% more.

.  Oddly, More Than quoted 7% more if you keep your car in a garage than if you park the vehicle on your driveway – none of the other insurers did this.

.  Direct Line added an extra 7% (low risk) and 8% (high risk) if you don't own your home, and LV an extra 4% and 5%.

.  Direct Line also added an extra 8% and 9% if you have children, but More Than didn't change the quote at all in these situations and Aviva and The Co-operative didn't even ask.

.  LV quoted 1% and 3% more if you are single, divorced or separated, rather than married or widowed.
It's unsurprising that driving convictions can really make the cost of car insurance stack up, however, we found the premium hikes can vary widely between different insurers:

.  More Than charged up to 55% more for motorists who received a conviction for 'driving without due care and attention', but Aviva only increased quotations by up to 7%.

.  Premium hikes for 'exceeding the motorway speed limit' also ranged greatly, from 2% for the low-risk scenario with Aviva, to 19% for the high risk scenario with More Than.

Which? executive director, Richard Lloyd, said:

"The cost of your car insurance can vary dramatically across the market, with some surprising factors affecting the price, so it really does pay to shop around and not automatically accept the first renewal offer from your existing insurer."

To see what made rates go up and down, we got online quotes for five of the largest insurance companies – Aviva, The Co-operative Insurance, Direct Line, LV and More Than. We created a high and low risk scenario by changing the make and model of the car, the drivers age, and their location, and then tweaking other variables to see how the rates change.

The low-risk scenario is a 2012 Ford Focus 1.6 Zetec driven by someone in their mid-40s living in rural Cambridgeshire, and the high-risk scenario is a 2013 BMW 120d Sports Coupé driven by a mid-30s motorist living in Tooting, London

VBRA - Code of Practice passes Trading Standards audit

The Vehicle Builders and Repairers Association (VBRA) recently had the operation of its code approval and conciliation processes scrutinised by the Trading Standards Institute (TSI) under the TSI Consumer Code Approval Scheme (CCAS).

VBRA's is the first code to be formally audited in this way since TSI took over the mantle of code approval from the OFT earlier in 2013.

After a thorough review of VBRA's processes, and interviews with the operating staff, TSI's report on VBRA's dealings with customer complaints says;

"VBRA's conciliation process is excellent [demonstrating] that they will provide additional support to consumers... [they] seek out and pay for independent experts to examine vehicles in order to resolve disputes.

"The very low number of disputes that reach arbitration (none in the last two years) is a reflection of the quality of the in-house conciliation service.

"VBRA are fulfilling their obligations as a code sponsor and ensure their members comply with the CCAS core criteria and their own code.
The in-house conciliation process is excellent and an example of best practice."

Commenting, Malcolm Tagg, VBRA Director General said

"The audit process was painless and endorses that what we have always done, regardless of external Code Approval, is good for customers and adds an extra comfort factor to inform motorists decision to use a VBRA member for their repair.

"We are fortunate our members are very good at what they do and very few complaints need to cross our desks – testament to the high regard in which they hold their customers and their dedication to getting it right first time."

Leon Livermore, Chief Executive, Trading Standards Institute said

"It is essential that TSI ensure code sponsors are complying with the requirements of the consumer codes approval scheme and that consumers can be reassured that the high standards of the scheme are being adhered to.
I would like to congratulate VBRA on their commitment to raising consumer standards."

'crash for cash' - fraudsters admit £150,000 personal injury insurance con from coach crash

Liam Gray pleaded guilty to two counts of conspiracy to defraud at Southwark Crown Court, while his friends Ben Carberry and Kevin Hamilton each pleaded guilty to one count.

The case came to court after Service Underwriting referred suspicions about whiplash claims from 30 people who had been travelling by coach to Belle Vue dog track in Manchester, in December 2011, to the City of London Police's Insurance Fraud Enforcement Department (IFED), triggering a criminal investigation.

The driver of the coach had told the insurer he was made to pull over on a roundabout at a junction of the M57 by passengers who said the coach had been hit from behind by a Renault Megane, even though he had felt no impact.

He reported that there was only very superficial damage to both vehicles, but that the passengers decided to cancel their trip saying they felt unwell and asked to be taken back to The Mons pub in Bootle where they had been picked up.

He said that before leaving the coach the entire group stated that they had been injured and gave him their details. He then watched as they ran across a dual carriageway and into the pub.

The insurer later established through a social networking site that Gray, Carberry and Hamilton all knew each other and had been to Everton football matches together.

IFED detectives travelled to Liverpool twice in 2012, arresting Gray and Carberry in June and Hamilton and Joe Hindley a month later.
They had found Gray hiding in a bathroom in Carberry's flat and at Gray's flat they seized Hamilton's driving licence and documents relating to the Renault.

Their investigation established that prior to the collision Gray had bought the Renault, along with insurance for Hamilton, and that Carberry had arranged and paid for the coach, as well as the group booking for the dog track.

They also identified that Hamilton had driven the Renault at very low speed into the back of the coach and that Carberry was Gray's contacts on the coach.

In November Gray was charged with two counts of conspiracy to defraud, while Carberry, Hamilton and Hindley were each charged with one count.

Gray, aged 26, of First Avenue in Fazakerley, was yesterday (Monday 19 August 2013) remanded in custody to appear at Southwark Crown Court at a later date.

Carberry, aged 20, of Old Hall Street in Liverpool city centre, and Hamilton, aged 35, of Asser Road in West Derby, will also be sentenced at the court at a later date.

Tesco- launches telematics car insurance policy aimed at 17 - 25 year olds; administered by Insurethebox

Tesco Bank has launched a pay-as-you-drive telematics policy aimed at young drivers aged between 17 and 25.

The Tesco Bank Box Insurance policy awards bonus miles if young people drive well, resulting in lower premiums on renewal, and includes an alert service that automatically contacts a call centre in the event of an accident.

The policy, which is administered by Insure The Box Limited and underwritten by Catlin Insurance Company and Great Lakes Reinsurance, is based on a telematics box installed in the car.

The box tracks the young driver's performance against 6 factors:
1 speed
2 braking
3 time of day
4 distances
5 type of road
6 breaks taken

The information gained is fed to policy holders through a personal web-portal so they can monitor their own performance.

Tesco Bank managing director, insurance Karl Bedlow, at said:
"Sitting behind the wheel of a car in those first few years of driving is exciting but also daunting and we want to help young drivers, and their parents, make it as safe as possible."

Research conducted for Tesco Bank by Vision Critical on a sample of 504 drivers aged 18-25 and 1,003 parents of children who learnt to drive found that 39% of young drivers said they had been involved in an accident.

Two thirds of young drivers said that regular feedback on their driving ability would help them to drive more safely. Among parents, 64% worried about their children's safety on the roads and 22% feared that their child drove recklessly.

End to compensation culture as government announces cracks down on ambulance chasing law firms

- Ambulance chasing law firms facing crackdown by ministers in move that could see insurance premiums drop

- Justice Secretary Chris Grayling wants to 'turn the tide on Britain's compensation culture'

- The fees lawyers can make for processing minor injury claims are to be reduced by more than half

- New limits will be placed on 'no win, no fee' cases

- The cost of car insurance could fall 10-15 per cent as a result of reduced payouts

Insurance premiums are expected to fall as ministers attempt to halt the gravy train for 'ambulance-chasing' lawyers.

Justice Secretary Chris Grayling will say today it is time to 'turn the tide on Britain's compensation culture' as he sets out reforms designed to slash rip-off legal fees and prevent insurers, claims firms and garages selling on details of accident victims.

So-called 'referral fees' are being banned, and the fees lawyers can make from processing basic claims for minor injuries suffered in road accidents will be cut by more than half from £1,200 to £500.

The Government is also imposing new limits on what lawyers can earn from controversial 'no win, no fee' cases.

Experts predict a 10 to 15 per cent drop in motoring premiums over the next 12 months as the changes take effect.

The existing system has pushed up legal costs and damages, and is blamed for a boom in whiplash injury claims, making car cover more expensive for all.

Ministers say it has also forced up insurance premiums in other areas, leaving schools, community groups and local authorities fearful of staging events and activities.

Mr Grayling told the Daily Mail: "We are turning the tide on the compensation culture. It's pushing up the cost of insurance, and making it more expensive to drive a car or organise an event. It's time the whole system was re balanced."

Referral fees were legalised in 2004 by the last Labour government, leading to a boom in the claims management industry. The cost of personal injury claims doubled to £14 billion in ten years.

Police, insurance companies, unscrupulous lawyers and breakdown firms have been accused of conspiring to profit from unsuspecting members of the public.

Fees are paid to claims management companies, garages and insurance firms which provide details of accidents to personal injury lawyers in a business estimated to have been worth £3 billion a year.

Claims managers then bombard motorists with texts and phone calls offering to help them to pursue compensation claims for alleged injuries.

The practice of referral fees has also left many hospitals, local councils and businesses with large legal bills.
Personal injury work is worth around £1.8 billion a year for solicitors, while the NHS is paying more than £1 billion a year in damages

The Legal Aid, Sentencing and Punishment of Offenders Act, which has just come into effect, prohibits payment and receipt of referral fees in personal injury cases by solicitors, claims management companies and insurers.

Claims firms are also being banned from offering upfront cash incentives or other gifts to those who bring cases to them.

Mr Grayling said that fees in 'no win, no fee' cases in the civil courts would also be limited. Previously, it has been possible to claim a 'success fee' on top of damages from defendants, often doubling what lawyers earn. Now, defendants will have to pay only the damages and the lawyer's basic fee.

From July, Mr Grayling said, a system used to settle payouts for road accidents quickly and simply without expensive court cases will be extended to also include claims for accidents at work and in public places.
The so-called 'claims portal' will also start handling claims up to the value of £25,000, up from £10,000 now.

The minister also promised action to crack down on the spiraling number of whiplash claims.

The Ministry of Justice has consulted on proposals to set up independent medical panels to improve injury assessment and allow the more questionable claims to be more easily challenged in court by insurers.

Simon Douglas, director of AA Insurance, said: 'The reforms should go some way towards bringing "no win, no fee" type whiplash injury claims under control and will thus reduce the costs of claims.'

AA reveals motorists concerns about bogus claims - 46% would consider a dashboard camera

An AA Motor Insurance survey of almost 10,000 people reveals that more than 46% of people would consider using a dashboard camera to protect themselves and for greater peace of mind in the event of a personal injury claim.

AA Consumer Affairs Director Conor Faughnan said, "There is no doubt that it is a driver's nightmare to be innocently involved in a minor collision only to find a major claim is being taken against you."

AA Insurance included the question in its most recent poll of motorists because the issue was highlighted, rather strangely, by the amount of remarkable footage of the meteor strike in Chelyabinsk, Russia last February. The reason so many dashboard cameras caught that event is because Russians have taken to the technology in a big way to protect themselves against bogus crash claims, and it is clear that Irish drivers think this is a good idea as well.

"Ten years ago we had a serious problem with the 'compensation culture' in Ireland. It was a key reason why our motor insurance was so high at double the typical cost of the UK," said Mr Faughnan.

The AA is concerned that the number of injury claims is creeping back upwards again despite fewer road crashes and a reduction in traffic volumes in the economy downturn. According to data from the Personal Injuries Board claims numbers increased by 5% last year and are up by a quarter since 2007.

"We have been here before and we do not want to go back. It will wind up costing every motorist money in rising insurance costs if we don't control it. Certainly we do not want to see the emergence of 'claims-farming firms' as has happened in the UK. These are as insidious and unwelcome as 'payday loans' and we do not want them in Ireland," concluded Mr Faughnan.

Drivers ‘Will Not Be Declined Car Insurance’ If They Fail To Disclose Information To Insurers Under New Consumer Insurance Act

Drivers taking out new insurance products will be given ‘added peace of mind that their claims will not be declined’ if they unknowingly fail to tell insurers everything about their lives.

Under the new Consumer Insurance Act, which comes into force on April 6, it will formalise the process of insurers asking ‘specific questions about information they need to know’.


“We want customers to take out insurance policies with the confidence that they are covered,” explained Otto Thoresen, Director General for the Association of British insurers (ABI). “By placing a legal duty on insurers to ask customers all relevant questions at point of sale, people will know exactly what they need to disclose upfront.”

Under the new Consumer Insurance Act, insurers have a ‘duty’ to ask customers all the relevant questions about the specific information required to value their car insurance.

It will also provide legal protection for motorists, with claims not being declined for not disclosing information – unless the information is ‘deliberately or carelessly withheld or misleading’.

“This Act reflects steps taken by the industry over the years to improve customer awareness of what they need to tell their insurer,” Mr Thoresen added. “For example, the ABI Code of Practice for life, critical illness and income protection insurance, which helped reduce the number of claims declined for non-disclosure.”

The new Consumer Insurance Act does not only cover car insurance, but also home, travel, life, critical illness and income protection insurance, health and pension annuities.

And it does not matter how motorists purchase their car insurance – online, telephone or even face-to-face – as the new rules still apply.

Whether anything will change in reality remains to be seen but it will require insurers to retrain staff and motorists are sceptical as to whether the Consumer Insurance Act will make any positive difference.