LONDON (Reuters) – Car insurance in Britain is too expensive because of complexity in the claims process and a lack of incentives to keep costs down, according to the country's competition watchdog.
Britain's Competition Commission said on Tuesday a complex chain for the settlement of non-fault claims – which involve drivers making claims for damage caused by others – resulted in higher premiums for all drivers.
It criticized the system for providing replacement vehicles and repairs for drivers whose cars were damaged in an accident, sending the bill to the at-fault driver and their insurer who have no control over the process despite having to pay for it.
The watchdog said this helped to push up premium costs by up to 200 million pounds per year which are ultimately shouldered by consumers across the entire $17.9 billion (11 billion pound) motor insurance market.
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