Motor-Vehicle Insurance

Press, Volume XCV, Issue 28257, 20 April 1957, Page 10

Motor-Vehicle Insurance

The decision of insurance companies to increase premiums on motor-vehicle policies and to allow larger no-claim bonuses implies rejection of the Road Safety Council’s proposal that indemnity payments should be denied grossly negligent drivers. This proposal was probably impracticable, and in any case ran counter to the reluctance of insurance companies to discriminate among their customers. Up to a point the companies are now giving effect to the principle of the council’s proposal. The new conditions will encourage safer driving while providing that those responsible for the higher cost of insurance pay a larger proportion. Because this is to be a general procedure some Individuals may suffer from anomalies, but it is certainly more equitable than asking the safe driver to pay the same

premium as the accident-prone driver. As to the need for any increase in premiums,, motorcar insurance seems to be a highly competitive business in which the State office and several mutual companies should protect the ordinary policy-holder from excessive demands. In fact, the State office last year forecast the need for an increase. “ Motor-car “ comprehensive business shows “no profit, but this is in line “with the experience of most “offices”, the general manager (Mr H. C. R. Blackwood) said in his annual report. “If the “ present loss ratio increases, “motorists must expect to pay “ higher premiums for their “ comprehensive covers The office’s accounts showed an underwriting deficit of 4.7 per cent, but it was not explained how much of this was on account of motor-car business.