Tag Archives: Office of Fair Trading

women's car insurance

UK insurers discriminate against young women drivers

Did we want equality or simply fairness?

Many motor insurers are adopting a Pontius Pilate approach to drivers under 25 which amounts to unfair age discrimination against young women who are safer drivers than young men.

Young women are not the same insurance risk as young men. In general, women take longer to pass their test, are less confident and less likely to speed compared to their young male counterparts. Statistics confirm it is young men who are responsible for the majority of serious and fatal road accidents.

I can understand why some motor insurers decline insurance for male motorists aged under 25. The evidence is written large and clear in the UK’s road accident statistics. And of course, some insurers see this as a business opportunity, charging eye-watering premiums that some say are actively encouraging the claims culture to recoup the premium cost… If true, this would be a self-fulfilling and self-defeating circle until the insurance industry gets its act together and agrees a strategic approach towards the young male driving risk.

As things stand, by refusing to underwrite ALL motorists who are under 25, many insurers are effectively discriminating against young women drivers who are the safer and better car insurance risk. These motorists have LESS choice of insurers so available rates are LESS competitive. Young women are therefore being tarred with the same risk brush as young men and are having to pay MORE than they would for their car insurance otherwise, simply because of their age.

Why is that happening now? First of all, it doesn’t make commercial sense because the sooner insurers start their customer relationships with women the more likely they are to reap our loyalty and referrals. Secondly insurers aren’t required to charge men and women the same car insurance premiums until the EU equality ruling takes effect in December 2012. When premiums will rise a lot for all females of course.

How can this be fair for female motorists? Why isn’t anyone standing up for our rights here? Has it ever been any different I wonder…

Some say that all these efforts to increase rates and reduce risk are designed so that insurers can regain lost profits after some lean and excessively accident prone years.

Hence the average 40% increase in rates in 2011 to date. And which seems to have happened without anyone needing to approve this level of increase.

Fortunately both the Ministry for Justice (MoJ) and the Office of Fair Trading (OFT) have been/are looking at different aspects of how the car insurance market is working so we can only hope that the issue of fairness will be addressed alongside that of equality.

Roll on the Ministry of Justice’s implementation of the ban on personal accident referral fees (it’s a start) and the OFT’s Call for Evidence review looking at ways to improve how the car insurance market is working.

FOXY Lady Drivers Club will be explaining to the OFT why this market isn’t operating fairly at present for women drivers with a particular emphasis on young women under 25 years old.

Please contact me via info@foxyladydrivers.com if you have any recent experience about motor insurance premium hikes and/or claims/accident handling to add weight to our submission.

FOXY

women

With or without the OFT?

The Office of Fair Trading’s future is uncertain and may affect Consumer Codes Approval Schemes.

A cost cutting proposal in a Government Green Paper is to suggest the merger of the Office of Fair Trading (OFT) and The Competition Commission. Consumer protection will pass to the busy local Trading Standards and Citizens Advice departments.

What will this mean to existing OFT Consumer Code Approval Schemes like the ones sponsored by Bosch Car Service and/or VBRA? Will they lose their relevance and quality teeth for women drivers if the OFT is not there to police them?

The CCAS website confirms this uncertainty re new schemes so perhaps the Motor Codes service and repair scheme may not now reach Stage Two to gain full approval?

Fortunately most of their subscribers are dealerships who can be expected to perform to higher standards than the undemanding ‘honest and fair services’ ‘open and transparent pricing’ and ‘work completed as agreed’ Motor Code standards.  I never really understood why the likes of Ford garages needed this when most are ATA employers already and they get rigorously inspected by the RAC. A waste of money even?

Either way, after c60 years of attempting to put its garages in order, the motor industry has done little of note because bad garages don’t join industry code schemes and still exist. And woman are most likely to be the ones overcharged, patronised and sold things we don’t need.

Despite Trading Standards efforts here (including a few Motor Trade Partnership schemes FOXY likes) these are regional not national bodies.

What is surely needed, with or without the OFT, is a fully regulated garage industry, to include independents, fastfits, bodyshops and franchised dealerships, because shoddy work can mean dangerous cars and compromise our road safety.

But garages’ll still need FOXY Choice’s marketing services to identify the genuinely female friendly businesses because even regulation won’t guarantee a business that understands what we women want!

FOXY

Find out about FOXY Choice approved female friendly UK garages

garage services

Rip off garages earn motor industry a bad name

I have just received a shocking email titled ’14 million UK motorists feel ripped off by their garage’ from Motor Codes who organise the Motor Industry Service and Repair Code. They have 6200 subscribers of which the lion share (>70%) are franchised dealerships.

I now realise that their research turns out to be based on 1194 motorists which they have extrapolated, for headline reasons perhaps, to suggest that over 14 million motorists ‘feel short changed by their local service and repair garage’.

On reflection whilst this is probably a highly misleading statistic no matter the qualifying asterisks in the Press Release if we assume that this is a sufficiently representative sample to be meaningful in any way, then the following findings are very worrying on their own:

  • Almost half of UK motorists (45%) feel they have been ripped off by garages (allegedly representing some 14,063,614 motorists).
  • UK motorists feel out of pocket to the tune of an estimated £2.4 billion
  • Young drivers are hit hardest with 41% of 16-24 year olds feeling ripped off by local garages to the tune of £51 – £150… which could be explained if they ended up in dealerships without realising they are more expensive than garages of course – whose fault would that be?
  • Some 30% of motorists aged 25-34 and over 55 were dissatisfied with their local garage
  • Over a quarter of all motorists who felt ripped off believed they paid between £51 and £150 more than they needed to… which could be explained if they ended up in dealerships without realising they are more expensive than garages of course – whose fault would that be?
  • 5% of motorists felt they had been ripped off to the tune of more than £300.
  • Those who felt more than £500 out of pocket claimed to be on average £1,408 worse off following their latest service.
  • The East feels the pinch the most where a third of motorists claimed to have been short changed, compared to just 17% of motorists in Northern Ireland.

If anything was to convince me that there is a case for regulating the UK garage industry, this research is surely it and may prove to be the tipping point for the likes of the Office of Fair Trading who will surely see that this is a quality hurdle too great for any Code of Practice to tackle, unless it’s compulsory…

Not serious at all according to Motor Codes however –  instead they think  it’s time to launch an upbeat Golden Garage competition using £16,000 prize money to reward the really good garages out there (and there are many, see the female friendly FOXY Choice website if you are in any doubt…).  Whereas I feel it’s time (and has been for some 50 years) to rid the industry of the really bad garages so that motorists can look forward to paying value for money prices for measurably good garage services in future, having understood the difference between dealership and garage standards and prices so they can choose the solution to suit them, their car and the occasion.

If that means regulation then so be it.

What I’d really like to know is the strategy behind this garage competition and how it will help outlaw the really bad garages who are as likely to cut safety corners to cut their costs as they are to rip off motorists.

Surely an industry scheme MUST DO MORE to ostracize those garages and dealerships that could be putting lives at risk and are certainly harming the image of this industry…

Yet by concentrating on good garages, Motor Codes seems intent on ignoring the cowboys.

FOXY