UK competition regulator moves to prevent cartelisation in motor insurance premia
14 January 2011
According to the UK's competition regulator, Office of Fair Trading (OFT) seven leading insurance companies and two partner firms have agreed to limit the private information they share on motor premiums.
The insurers are Ageas, which was formerly known as Fortis, Aviva, AXA, Liverpool Victoria Friendly Society, RBS, Royal Sun Alliance and Zurich.
With the Experian software they use insurers can access not only the pricing information they themselves provide to brokers but also the premiums supplied by their competitors.
In theory this allows insurers to tie their charges to that of rivals which can lead to limiting competition and keeping premiums artificially high.
Under an agreement they have undertaken to sign insurance firms and their partners, including Experian will enter into a legal pact to prevent such detailed information sharing in future.
Welcoming the OFT move, the official customer body, Consumer Focus has called for the crack down to be widened.