Private motor insurance
Start date: 15 September 2011
Completion date: 28 September 2012
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Summary of work
The OFT provisionally decided to refer the market to the Competition Commission (CC) in May 2012 after a market study gave reasonable grounds for suspecting that there are features of the market that prevent, restrict or distort competition.
The OFT's market study focused on the provision of replacement vehicles and vehicle repairs and considered that the insurers of drivers responsible for an accident ('at-fault' drivers) appear to have little control over the way repairs and replacement vehicles are provided to the 'not-at-fault' driver. This may enable the insurers of not-at-fault drivers, and others such as insurance brokers, credit hire organisations and repairers, to engage in practices which appear to result in the cost of replacement vehicles and vehicle repairs provided to not-at-fault drivers being higher than they might otherwise be.
Having considered the responses submitted during a public consultation process, the OFT continues to hold the view that there are reasonable grounds for suspecting that there are features of the market that prevent, restrict or distort competition, and has decided that a more in-depth investigation by the CC through a market investigation reference is appropriate.
The CC has up to two years to report its findings. If it finds that features of a market are harming competition, it has powers to impose remedies to address the situation.
Action
The OFT has referred the market for private motor insurance and related goods or services to the Competition Commission for investigation, under section 131 of the Enterprise Act 2002.
Related documents
- Decision to make a Market Investigation Reference (pdf 458kb)
- Terms of Reference (pdf 27kb)
- Press release OFT refers private motor insurance to the Competition Commission (28 September 2012)
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Call for evidence
Background
- Report on the market study and proposed decision to make a market investigation reference (pdf 780kb)
- Press release OFT provisionally decides to refer private motor insurance market to Competition Commission (31 May 2012)
- Press release OFT launches market study into private motor insurance (14 December 2011)
- Summary of responses to the OFT's call for evidence on private motor insurance (pdf 497kb)
Contacts
Team leader: Tarnya Wilkins (020 7211 8154 tarnya.wilkins@oft.gsi.gov.uk)
Project director: Claire Hart (020 7211 8782 claire.hart@oft.gsi.gov.uk)
Senior responsible officer: Claire Hart (020 7211 8782 claire.hart@oft.gsi.gov.uk)
Media enquiries
Any media enquiries should be directed to a member of our Press Office.
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