January 2008

Drivers told to get legal or get crushed
Accidents caused by motorists without cover add about £30 to the annual premium of honest drivers. And, on average, 160 people are killed every year in crashes caused by drivers with no cover.

Police have had the power to seize uninsured cars for two years. But they are now using them with growing confidence because of a closer working relationship with the Motor Insurers' Bureau.

The MIB investigates and pays for claims when drivers have no insurance or are untraced. Last year, it needed £360m to meet these claims, paid for by a levy on the premiums of all motorists.

The MIB also runs the Motor Insurance Database - a record of cover details for every vehicle in the land. And the database is giving police a crucial edge. Computerised cameras that read number plates of passing traffic and, via a link with the database, automatically identify vehicles that appear to have no insurance.

About one in three drivers who are caught never reclaim their car, leaving police to bear the cost of crushing, disposal or resale.

For the past two years, insurer Direct Line has paid some of the costs of recovery and storage of uninsured vehicles in County Durham, allowing police to target the problem hard. Almost 4,000 uninsured vehicles have been taken off the road through this initiative.

Those prosecuted through magistrates courts in 2005 were fined on average just £173 - far less than the cost of an annual policy. But the growing willingness of police to take uninsured cars off the road has tilted the balance. Most receive a fixed-penalty notice. This is a £200 fine and the driver's licence is endorsed with six points.

They also have to pay for the cost of transporting their car from the roadside, typically more than £100, and daily storage costs of between £10 and £20 depending on the police force area. They can reclaim the car only after they produce valid insurance documents.

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Travel insurance 'should be obligatory'
Travel insurance should be a requirement for Britons before they leave the UK, it has been suggested. Leading industry figure Perry Wilson, said that the importance of travel insurance is often underestimated by people who are going abroad.

Many travellers think that travel insurance is "about your flight being cancelled", he remarked.

"That is a part of it, but the biggest part of it is medical - accidental damage to yourself and also personal liability if you cause damage to someone else," commented Mr Wilson.

He added that it is important for people who plan to take part in adventure sport - such as skiing or snowboarding - to ensure that they are covered before they go.

Even minor injuries, such as a broken leg or ankle, can cost "thousands of pounds", he said, adding that "the average ski claim is in excess of £2,000".

The ski market increased by three per cent during 2006-07, according to the Crystal Ski Industry Report.

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Equity adds to motorcycle book with Bike Team purchase
Equity Insurance Brokers has acquired the entire book of specialist motorcycle broker, Bike Team, including the rights to continue to promote the Bike Team brand.

The business will transfer to Equity's existing specialist bike centre in Colchester which already administers motorcycle insurance under its 'insure' brand and also services a number of insurance schemes for various partners including Harley-Davidson and Triumph Motorcycles.

Nick Potts, Equity's managing director, said: "Highly regarded in the specialist motorcycle market, Bike Team is widely recognised for providing great value insurance, for the quality of its people and their understanding of bikes and bikers.

"We are delighted to have acquired such a strong brand and that two of the current owners - Mark and Paul Davies, have agreed to join us to develop its undoubted potential within the Equity Group."

Bike Team managing director, Bob Davies, added: "We are tremendously excited to be working with Equity. In addition to ensuring Bike Team's position as a leading force in the motorcycle market, Equity's passion, drive and commitment to the brand's success opens up huge possibilities for the future.

"For more than a decade, customer relationships have been the defining feature of the Bike Team business; the acquisition by Equity is great news for all our clients."

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Bank of England Maintains Bank Rate at 5.5%
The Bank of England’s Monetary Policy Committee today voted to maintain the official Bank Rate paid on commercial bank reserves at 5.5%.

The minutes of the meeting will be published at 9.30am on Wednesday 23 January.

The previous change in Bank Rate was a reduction of 0.25 percentage points to 5.5% on 6 December 2007.

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UK Shares See Biggest Slide For More Than Four Years
Billions of pounds have been wiped off the value of Britain's top shares because of continuing worries about the US economy. The FTSE 100 fell by more than 5% this morning amid worries America may be heading for a recession.

It was the biggest slide in more than four years. Other European markets, and those in Asia, also suffered badly, despite attempts by President Bush to shore up the US economy.

Last Friday, he unveiled a package of tax cuts and other measures worth more than £72bn.The problems have been caused by the sub-prime mortgage crisis and subsequent credit crunch.

On the London stock market the biggest casualty was building materials company Wolseley. The firm's shares plummeted after it revealed its five-month trading profit had slid by 25% because of the worsening US housing market.

Others badly hit included the Royal Bank of Scotland and Barclays. The dip in UK share prices comes after Wall Street suffered its worst week in five years. Commerzbank economist Peter Dixon said: "The fact is that when the US goes down the pan, everybody else follows."

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