The Office of Fair Trading (OFT) has referred the UK’s private motor insurance market to the Competition Commission (CC) for an-depth investigation because it suspects that the market may not be working well for motorists. It has concerns that insurers of “at-fault” motorists appear to have limited control over the charges they pay which may be leading to increased costs for them and higher premiums.

Background -

The OFT called for evidence in September 2011, following reports that motor insurance premiums had apparently increased by 40 percent in 2010 and 2011. In December 2011, the OFT launched a market study into private motor insurance in the UK. The OFT may carry out what is called a “market study” as part of its general function to obtain, compile and keep under review sufficient information to make informed decisions, including in relation to competition law and consumer protection matters.