The motor insurance industry must present its case well to the OFT

The Office of Fair Trading has issued a call for evidence to establish the background to recent reports of rising UK private motor insurance premiums. The OFT has stated that comprehensive car insurance in the UK has risen by up to 40% in the year ending 31 March 2011, but it doesn’t seem to know why.

Insurers and others have been asked for their views on motor insurance, including the role of price comparison sites, provision of credit hire and use of panel repairers. All responses are required by 12 October.

Everyone knows premium rates are rising, but we also know that the UK motor market is one of the most competitive insurance markets in the world. It’s important that the industry presents its case well. The OFT is taking this seriously - it is crucial that the industry clearly shows it is operating in a highly competitive market. Consider your submission carefully - the OFT and others certainly will!

Stuart Shepley is an insurance partner at KPMG

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