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'Motorists may get more accurate insurance cover'

(23 Feb 2007)

Going on holiday? – Get a great deal on travel insurance

Consumers could be in line for more accurate motor insurance policies following changes to the motor insurance group rating system by the Association of British Insurers (ABI).

Under the move, the ABI hopes insurers will be able to take account for recent technological changes and the range of new vehicles available.

Assistant director for motor and risk pricing, Justin Jacobs said: "With repair bills now costing over £7 billion a year, these changes will help insurers keep pace with technological changes and more vehicle types to ensure they continue to provide value for money policies for customers."

The move will see the number of vehicle groups increase from 20, when the system was last amended in 1992, up to 50.

New car types such as 'city' models, different repair techniques and vehicle weight are just some of the factors set to be taken into account.

The ABI warned that although motorists are unlikely to see any changes in their insurance policy until later on this year, the system could affect premiums depending on the individual characteristics of vehicles.

In January a number of motor, home and travel insurance companies were warned by the Financial Services Authority to stop misleading consumers via their advertising campaigns.

However travel insurance advertisements are reported to be of a higher standard than their home and motor insurance counterparts.

© Adfero Ltd