Two thirds of consumers don’t trust that insurers will pass on savings from reduced personal injury pay-outs, a poll by Consumer Intelligence shows.
Yesterday the Ministry of Justice revealed plans that it claimed would reduce whiplash claims and save motorists an average of £40 a year on their car insurance. It said that leading insurers had pledged to pass on the savings, which it estimated would amount to £1bn across the industry.
However, 67% of 510 people surveyed by Consumer Intelligence said they believed the industry would pocket the difference themselves and they wouldn’t see a difference in their premiums.
Some 15% said they trusted the whole industry to pass on savings, while 18% said they trusted their current insurer would pass on savings but didn’t think the wider industry would follow.
Motor insurance premiums have rocketed in the last year. The Consumer Intelligence Car Insurance Price Index shows motorists paid an average of £788 in August – a 13.5% increase in the past year alone.
Consumer Intelligence chief executive Ian Hughes said: “It’s disappointing that consumers don’t trust insurers to pass on the benefits from paying out less in claims. But this presents an opportunity for brands to build trust by delivering on their promises and doing so transparently.”
The poll also showed that most people think whiplash pay outs should be higher than the government’s proposed £425 cap. Only 35% of respondents considered up to £500 to be fair compensation, while 22% said legitimate claimants deserved to receive £500-£1,000, 20% £1,000-£1,499, 11% £1,500-£1,999 and 11% over £2,000.
The average pay-out of whiplash is currently £1,850 according to the MoJ.
The survey also showed that 95% of people back the MoJ’s plans to require insurers to review medical evidence before settling whiplash claims.
About Consumer Intelligence
Consumer Intelligence (CI) is a market research agency specialising in the General Insurance and Banking Sectors. We have spent the last 13 years perfecting the art of collecting data so that organisations can benchmark themselves. Since 2003, we have been collecting and analysing millions of prices across the telephone, direct insurer websites and aggregator channels.
We conduct quantitative and qualitative research with consumers to understand who they trust, why they choose who they choose, and what influences or informs those decisions.
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Elinor Zuke, Consumer Intelligence PR Manager
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