Insurance gone up?

Explaining the Ogden Rates and how it may affect you

What’s going on?
In 2017, the Ministry of Justice announced it was cutting the discount rate, known as the Ogden Rate, used to determine lump sum compensation to claimants who have suffered life-changing injuries. Insurance companies are therefore having to pay more of the money themselves and this could result in insurance premiums increasing. Certainly we have seen renewal premiums increase by 10 or even 15% on last year.

What does the industry say?
The Association of British Insurers (ABI) have commented that they believe that claims costs will soar, making it inevitable that there will be an increase in motor and liability premiums for millions of drivers and businesses across the UK.
Daily Telegraph 27th February 2017

Is that it then?
What we must remember is that we are also in a ‘soft market’; insurance companies are very keen to transact new business and premiums are just as competitive as before.

What is a soft market?
A soft market is characterized by the following:

  • Many insurers are competing for business
  • Coverage is widely available
  • Insurance prices are low
  • Underwriters are flexible and willing to negotiate coverage terms
  • Broad coverage is available with some extensions available for free
  • Underwriting standards are relaxed

So, what should I do if my premiums have increased?

At MRSL, we felt it would be helpful for you to know you that we are, and always will be, a completely independent insurance broker, with access to the
whole UK insurance market, including Lloyds. We are therefore able to look at your existing insurance and negotiate either with your current insurer to minimize, or even mitigate, any increase due to external factors such as the Ogden rate, or approach the market for a new insurer to take over the risk. In both situations, we would look after the process completely and present you with the very best policy at the very best premium.

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Explaining the Ogden Rates and how it may affect you