Motor Insurance to take More Conformist View in 2017

Today, I'm going to show you a new conservative view taken by Motor Industry in the year 2017.

The Second Quarterly Motor Industry Review of 2016, issued by the Society of the Irish Motor Industry and DoneDeal. According to the DoneDeal/SIMI report, the Motor Industry has made a strong performance in the first half of 2016. It is recorded that Exchequer collected Euro 978.4 in VAT and VRT receipts from both new and used car sales in the first half of 2017. It has also declared 28.5% of hike in 2016 from the year 2015, which is quite noticeable.

Although there have been some conservative notes as the year has progressed, the economic outlook forecasted car sales to reach 152,000 by the end of the year.

Conservative Notes by the Economic Outlook

According to Jim Power Economist and the author of the SIMI/ DoneDeal, the car sales growth will be low or even flat in the year 2017. This states that the market is approaching but still less than the natural rate. It has also been highlighted in the review that the expenses of monitoring, in general, has decreased by an average 3% when compared to the price of new cars.

Drastic Changes

There is a drastic change in the petrol and diesel prices; it is declined by 8.4% and 12.4%, respectively. Comparatively, the cost of motor insurance is increasing significantly. It is recorded that the car prices have been increased by 38.6% in the first three months of 2016. SIMI has stated the issue of increasing motor insurance costs, which is affecting younger drivers and old car owners.

SIMI President, Alan Greene stated that around 32,285 used cars were imported to India in the first half of 2016, but the research says that they should never be allowed on the roads here. It is totally improper that unsafe cars written-off, which are removed from the roads of other countries, to be registered and used here. There are huge numbers of cars written off here, which are not recorded for their unsafe driving statuses on the NVDF to protect the future owner and other drivers on the road.

SIMI is pressurizing on these issues for action form too long and it is important to deal with such critical problems as soon as possible. Making the decision on write-offs is in the hands of the Cabinet and we recommend the Ministry to take adequate action on the same. It is legally required to record total write-offs and details of damaged motors in the NVDF along with strictly prohibiting the registration of unsafe and dangerous vehicles, which have been written-off previously in other countries. This will save lives and will protect different drivers on the roads.

Affects on Motor Insurance

The increasing cost of motor insurance plans is also a matter of concern, especially, in the case of young drivers or for those driving older cars. The projected action on write-offs will definitely help in this regard but more than that it is important to reduce the cost of motor insurance plans in the market.

It is high time now and the Government should establish a strong review of the reason for the current increasing cost of motor insurance.

There is a real danger in the future if drivers on roads are driving the cars without valid insurance because of high insurance costs.

Studies from DoneDeal, the Ireland's best motoring site, mentioned that the growth rate seen in the Motor Industry with car Dealership advertising volumes has been increased by 19% in the first half of 2016.

It is said by CathalCremen, Commercial Manager of DoneDeal's Motor Section, "it's good to see the Motor Industry growth in H1 2016. At DoneDeal, after observing significant growth trends, we can estimate over 72% of total Dealerships stock, 8 years old or younger are being advertised on DoneDeal's car sector.

It is recorded that the first half of 2016 had a growth in trade-ins and the number of Dealerships subscribing across the nation and advertisement on DoneDeal had grown by 16.4% each year. This has been an identical contribution factor in the motor sector with an annual growth of over 21% in Dealership sales. It is sure that behind this growth, DoneDeal's tie-up with SIMI is also one of the major reasons.

The major reasons behind new car sales are being carried by the stable and growing economic recovery, significant growth in employment, recent relaxation in the personal tax burden, personal disposable incomes, and the availability of car finance.

Conformist View &Motor Insurance

The positive growth in Motor Industry has raised the demand for insurance and various car insurance plans available in the market offer different benefits to the owner-driver and the insured vehicle as well – in terms of coverage. In fact, it is very important for a car owner as well as for the vehicle.

Check out some common points of coverage offered under car insurance policies:

Personal Accident

A comprehensive car insurance plan also offers protection to the owner-driver against any loss or damage occurred to the owner-driver in the event of an accident. It covers the treatment expenses incurred for availing treatment for bodily injuries to the driver. Some policies cover fellow passengers as well.

Third-party Motor Insurance

Third-party car insurance is mandatory as per Indian Motor Vehicle Act, 1961. It provides coverage against expenses incurred in a case when the insured vehicle becomes the reason for loss or damages to a third-party vehicle or property.

Damage to Own Car

A motor insurance policy also offers coverage against damages to the insured car. It offers cashless garage service across the country. The owner of the insured vehicle can avail the facility of cashless garage in case of an unfortunate event, such as flat tyre, damages to the vehicle etc.

A motor insurance policy also covers the cost incurred due to any unfortunate events like natural or man-made calamities. Therefore, it is the best to buy car insurance soon after buying a car. It helps you to achieve the peace of mind and saves your pocket from unexpected expenses.

Conclusion!

The motor insurance industry has taken a conformist view in 2017 so far even after it had a strong performance in the Q1 and Q2, last year. This was despite a significant hike of 28.5% as compared on the year 2015. Car sales are expected to boom by the end of the year as per economic outlook.