Norwich Union car insurance a slap in the face, expert claims

Fri, 01 Sep 2006

Norwich Union's decision to raise the price of its car insurance policies is a "slap in the face for safe drivers", an expert has claimed.

The car insurance provider is increasing prices by six per cent for low-risk customers, which is double the rate of inflation, states Richard Mason, director of insurance at Moneysupermarket.com.

High-risk drivers will also be affected, as they will see a rise of up to 35 per cent which is "almost as good as a goodbye letter", he remarks.

"Norwich Union has dominated the motor insurance market for many years now, but this announcement of such a large price increase is a brave, if not foolhardy, move indeed - even for the largest car insurer," said Mr Mason.

"If it is not careful Norwich Union could be left out in the cold with this move."

The expert adds that other car insurance providers, such as esure and Swiftcover, have lower operating costs than larger companies like Norwich Union and Royal & Sun Alliance, which allows the smaller firms to pass savings on to consumers.

Norwich Union's parent company, Aviva, is one of the largest insurance groups in the world.


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