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Government and FCA launch motor insurance and premium finance task forces

The Government has launched a task force to identify actions that may stabilise or reduce motor finance premiums. The FCA will help with the study and will look at the causes of increased costs and will examine claims costs, with a view to analysing the impact of higher motor insurance prices on different customer groups and looking to see how standards of cover can be maintained at lower cost.

Alongside this, the FCA has started a competition market study to assess whether people who borrow money to pay for motor or home insurance are getting fair, competitive deals. It is concerned that the average yearly rate of 20-30% may not be providing fair value, particularly because high numbers of borrowers are in financial difficulty when they use the product.

Emma Radmore