Compensation Rate Change Drives Up Motor Insurance
Law360, London (January 9, 2020, 4:29 PM GMT) -- Motor insurance premiums have risen by 2.2% over the past year, a price index company reported on Thursday, following changes to the way compensation is paid to those who suffer life-changing injuries.
Consumer Intelligence said the price rises were probably a result of the government’s amendment to the personal injury discount rate, known as the Ogden rate, in 2018. The change forced insurers to plow money back into their claims reserves.
The cost to insurers was likely to have been passed on to customers in the form of higher premiums, the company said.
“Before the Ogden rate was announced, many insurers had...
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