There are many factors that influence the calculation of premiums. Here, we hope to give you some insight into some of the key factors that affect how insurers determine premiums.
Political change and its economic consequences can have a significant influence on individual insurance premiums.
One example is the current uncertainty over Britain’s exit from the EU, which has already reduced the strength of the pound. This is affecting, among other things, the cost of motor parts manufactured outside of the UK, which in turn increases the cost of repairing a vehicle and therefore the premiums needed to cover future motor claims.
Two other examples are the recent increases in insurance premium tax (IPT) and the reduction in the Ogden discount rate. The UK Government has announced a number of successive increases to IPT over recent years, directly impacting the amount customers pay for their insurance. While this tax is collected by insurers, it passes straight to the government.
The reduction in the Ogden rate, meanwhile, will have a significant impact on personal injury compensation awards and on injury claims reserves.
Insurance companies face the same sorts of changes to the cost of doing business as their customers. For example:
Insurer business models
In addition to typical business outgoings, insurers’ business models also feature a number of unique factors that will influence insurance premiums. These include:
The following are examples of specific factors that have recently affected particular lines of insurance business:
Despite the importance of these factors in determining premium levels, we will always look at each customer on an individual basis, and try to limit the impact of factors outside of your control.
What our clients say
Always helpful, polite and professional. Well done. D&M Leftly & Sons Ltd
Really easy process, really good service. MJB Transport Services Ltd
Top-class service from Avis, 100% recommended! X Transport Ltd
Informative and efficient service. J Borthwick Haulage Ltd
Speak to our friendly, knowledgeable team today and let us find you the most competitive Lorry insurance, Truck Fleet insurance, road haulage insurance, commercial vehicle insurance, Goods-in-Transit and Public & Employers’ Liability available anywhere on the market! Enter your number, and one of our friendly team will give you a call.
A few of our insurance providers