Gouging insurance companies?

[fatpies]

https://www.telegraph.co.uk/finance/yourbusiness/8955539/Car-premiums-artificially-high-admits-insurer.html

[Rogerborg]

I pre-emptively agree with whatever Hetzer has to say on this.

I'll further add that:

1) No law will stop someone driving without insurance.
2) The MIB already runs an uninsured driver scheme, which will pay out and then seek to recover from the culprit.
3) The most effective price competition for insurers would be the option to choose none of them, and take responsibility for the consequences of your actions.
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[Kwaks]

Sounds like the manager doesn't understand his business.

They need to ensure they have sufficient funds to pay future claims, which means either holding cash or reunderwriting with the likes of lloyds.

they simply pass on the costs, his company might have a couple of good years
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[iooi]

[Rogerborg]

[iooi]

Well when you win the lottery........
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Just because my bike was A DIVVY, does not mean i am......

[J.M.]

[robbieguy2003]

They're a bunch of cnuts, the lot of em. I disagree with some of the comments about the company that didn't want to put up prices but did so it'd be inline with the market.

Can you imagine the pain an insurer would get if they're constantly getting hammered because they're £200-300 cheaper than others in comparisons? Sure it sounds good because you're getting lots of extra business, but it's not stable growth, you're only getting it because you're the cheapest, which means when someone else is cheaper then the flock with leave. At some point in this cycle you'll get bitten, this could be relocating to premisis that can handle 800 staff because your current setup only has enough room for 400 people, who are constantly on the phone and you cant pick up all the calls. So you could spend a shitload of money and tie the company into a 10 year office lease because you've had a really amazing 6 months, meanwhile people aren't rating you well because you take an hour to answer the phone.

It's quite common for companies to price themselves out to avoid growth across several industries.

Think of a guy doing web design work, if he has 5 well paying projects on and he's already working a lot of hours and a 6th comes along, he might be more selective about the project and quote a higher rate to deliver the work, knowing that it'll be an impact on his life to deliver it. On the same hand, if he had no projects on the go the rate might drop so he's at least getting some money in the door.

I think it's simple economics, i'm not saying it's good but it does appear to be what happens.

I still think insurance companies are not regulated enough though, as an industry that most people have no choice about using, they seem to get away with a hell of a lot.
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Current Bikes: Honda CBR 600RR - '07, Suzuki GSX1250 FA ST '11
Old Bikes: Suzuki Intruder 125 LC - '2001, Honda CBR 600F - '92, Honda CBR 600RR - '03