Warning issued over increasing van insurance premiums

Date: Wednesday, July 31, 2019 | Author: Sean Keywood

Van insurance premiums could rise over the coming months as a result of a government decision taken in July, according to data analytics firm Consumer Intelligence.

It says a reset of the Ogden rate, which sets payments for major personal injury claims, from -0.75% to -0.25% fell short of insurers’ expectations of it being between 0% and 1% – a range it says many insurers have been working to over the past few months.

The news comes after a 12-month period where van insurance premiums have already risen by 8.3% and now stand at an average of £1,171.

Vans insured for business use continue to attract higher average premiums than those in the social, domestic and pleasure category, at £1,046 versus £1,202, although this gap is said to be narrowing slightly.

Consumer Intelligence pricing expert John Blevins said: “As we’ve now had confirmation of the Ogden changes, we’ll be monitoring – with interest – the impact on pricing.

“Depending on how insurers have managed their claims reserves in preparation for the change, this will dictate if we see any painful increases in premiums or – indeed – some welcome price reductions over the coming months.

“Drivers using vans for work are more likely to make bigger claims as it’s not just damage to bodywork but lost business and damaged equipment they will be claiming for.

“There are some minor issues of fraudulent claims across the market, which potentially has more impact on business users.”

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