Why has my van insurance increased this year despite my no claims discount?
My son started a gardening business last year and insured a Renault Kangoo Van for £360. It is his first vehicle despite him being 45 years old. This year we were expecting it to reduce with one year's No Claims Bonus but it has gone up to £450. Comparison websites suggest that this is actually quite good as he can't find anything lower. Why has there been such a massive increase? Allowing for a modest 25 per cent NCB, the full premium must be £600.
Asked on 23 March 2017 by Robert12345
Answered by
Honest John
The reason for the increase is due to the reforms on personal injuries, which has led to an amendment on the Ogden Rate (this is a multiplier attached to personal injury claims for those who will be affected for their full life). This means that insurer's have to set higher reserves to take into consideration the higher payouts they will have to make over the lifetime of these claimants. The insurance premium tax has also increased from 8 per cent to 10 per cent. Expect further increases year on year.
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