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U.K.: Commission probe bad for motor insurance market?

By  |  October 7, 2012

Moody’s, a credit rating agency said in a report that the Competition Commission’s investigation into motor insurance market would create uncertainty for the industry, reduce motor premium rates, and hurt profitability of insurance companies. The OFT, last week referred to the Competition Commission after concluding that ineffective competition was inflating drivers’ insurance costs. The competition inquiry is likely to take up to two years, and will focus on how insurers provide replacement vehicles to customers involved in accidents. According to the Reuters, the competition watchdog could impose changes that would make it harder for insurers to boost their profits through fees for ancillary services such as replacement vehicles.

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