Good news! Motorists may see lower insurance premiums as seven insurance companies and two IT software and service providers have provisionally agreed to limit the data that they exchange between them after the Office of Fair Trading raised competition law concerns.
Insurers Ageas Insurance Limited (formally Fortis Insurance Limited), Aviva plc, AXA Insurance UK plc, Liverpool Victoria Friendly Society, RBS Insurance Group Limited, Royal Sun Alliance and Zurich Insurance plc, and the IT software and service providers Experian Limited and SSP Limited have all offered formal commitments to the OFT. This follows an OFT investigation which identified an increased risk of price coordination among motor insurers using a specialist market analysis tool by Experian called Whatif? Private Motor.
The OFT limited the scope of its investigation to a small number of parties with a view to achieving a swift outcome. However, the investigation potentially has wider implications as the Experian tool is just one of a number of similar products used throughout the insurance industry. The tool allowed insurers to access not only the pricing information they themselves provided to brokers but also pricing information supplied by other competing insurers.
Even with the results of the OFTs action, savings can be made in just shopping around for quotes. Insurers rely on customer inertia.