March 15, 2012

Motor insurance premiums are so high now that consumers are taking on higher and higher voluntary excesses to make their premiums affordable. Only problem is: this often means they can’t afford to get their vehicles repaired following an accident.

On the rare occasions when they get to claim something for repairs over and above the £1,000 excess limit they’ve cunningly selected on their 1998 Volvo Estate, they belatedly realise they can’t afford to pay the necessary sum upfront – without which repairs cannot commence.

AXA this week claimed that as many as one in three motorists are unable to afford their excess costs and hence are driving vehicles held together with gaffer tape and string, leaving them hanging around (deteriorating) for ages til they get some cash in, or abandoning them altogether.

Average voluntary excesses have risen by 10% over the past two years, AXA claims. Presumably there might have been an even bigger increase if more people realised they could cut their premiums by increasing their excess. But, according to AXA, almost one in five don’t even know what their excess is.

One solution to this growing problem has recently emerged in the shape of excess protection policies*, which allow motorists to purchase a separate low-cost policy that refunds any excess they have to pay. Why anyone wouldn’t want one of these is completely beyond Bankstone News.

But quite how such policies will affect the overall dynamics of the motor insurance sector, as and when they take off in a big way, is another question altogether.

Might have to think about that one…

Click on the subtly tasteful image above to see the incredible chameleon woman.

It’s not that lass from Cheadle, btw.

* Other excess insurance providers are available.


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