Aviva’s Blanc hits back at Labour’s ‘flawed’ view on car insurance

Aviva chief executive Amanda Blanc has said that Labour’s plans to clamp down on motor insurance premiums are based on flawed logic.

Earlier this month (5 June 2024), shadow transport secretary Louise Haigh said Labour would call on regulators to investigate increasing car insurance premiums.

She told The Mirror that premiums were currently “out of control” and that there needed to be a clamp down on “any unfair practices”.

According to the Financial Times, Blanc said that the promised clamp down would be using a “sledgehammer to crack a nut” at FT’s Global Insurance Summit in London.

And she felt that saying there was an issue with the market was “fundamentally flawed”.

“You have to say this market is competitive,” she added.

“[If there are] actors in this market who are maybe taking advantage . . . deal with that. You do not need a sledgehammer to crack a nut.”

ABI

Haigh made her comments after figures from Confused.com and WTW showed that car insurance premiums saw an annual rise of 43% (£284) from Q1 2023 to Q1 2024.

The rise comes amid an increase in costs to insurers, with EY estimating that for every £1 collected in premiums, the industry paid out £1.14 in claims and expenses.

And from the end of 2017 to present, costs for insurers to pay claims have risen by 23%, according to the ABI.

However, speaking at the event, ABI chair Baroness Nicky Morgan said she expected any incoming administration to focus on the consumer.

The ABI itself also set out the steps the industry was taking to combat the rise in the cost of motor insurance at its conference in February 2024.

It also announced that its members had agreed a set of principles on premium finance, aimed at managing the cost associated with paying for insurance on a monthly basis.