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Car insurance news uk bbc

Young drivers car insurance deals Image copyright AP Image caption The motor industry is anticipating the era of connected, driverless vehicles

An almighty row has broken out over who should have access to all the data new cars generate.

Manufacturers want to have control of it all, but independent repair shops, fleet operators, insurance companies and anyone else who could benefit from this data, argue that this would be blatantly anti-competitive.

Policy wonks in the European Union are currently wrestling with the issue.

So why should you care?

Because it could mean that your car servicing costs become more expensive and you may have to pay more for other services that rely on such data, from independent repair centres to "pay-as-you-drive" insurance companies.

Modern cars are effectively computers on wheels, full of sensors measuring everything from the wear and tear on your brake pads to your fuel efficiency.

They are capable of communicating wirelessly with manufacturers, traffic management systems, and other vehicles in real time.

So your car's manufacturer probably knows where you've been, how fast you drove, and how soon you're likely to need a service.

And it wants to turn this knowledge in to money.

Image copyright Getty Images Image caption Hyundai vice chairman Euisun Chung talks about connected cars in Las Vegas

Say your car's onboard sensors detect that a certain part is about to fail. The manufacturer will have wireless access to that data and could then alert you and even book a service for you automatically.

That sounds convenient and useful, right?

But what if the repair centre is owned by the car manufacturer? You might not be getting the best price for the new parts and servicing. And what if their authorised repair centre is a lot further away than your local garage?

"While the manufacturer is monitoring the car, it has the power to recommend its own spare parts. This is a privileged position and would distort the market," says Neil Pattemore, technical director at FIGIEFA, the European association representing car parts retailers and repair shops.

"We exist to offer consumers choice - it's about freedom of where you want to get your car repaired."

The European Automobile Manufacturers Association (ACEA) is arguing that car makers should be allowed to send all this "in-vehicle" data to their own cloud platforms and control who has access to it and under what terms.

Allowing "direct third-party access to vehicular electronic systems would jeopardise safety, (cyber)security and vehicle integrity", it argues.

Image copyright Thinkstock Image caption Some car makers already allow phone apps to synchronise with in-car systems

Manufacturers say they're worried about hackers taking control of a car's electronic systems, as has been shown to be possible on several occasions.

They also fear that allowing third parties to peer in to their cars' "brains" would jeopardise "trade secrets, know-how or information covered by intellectual property rights".

But a growing number of industry bodies think this has more to do with manufacturers trying to control a potentially lucrative business.

"In the connected era, every vehicle will have its own in-built telematics device and the functionality of a smartphone," says Gerry Keaney, chief executive of the British Vehicle Rental and Leasing Association (BVRLA).

"The data this generates opens up a whole new range of opportunities to develop driver-based infotainment or navigation services.

"It also promises to revolutionise the ways vehicles are maintained and managed, enabling vehicle owners to share them between multiple users, fix them before they break down or streamline the repair and servicing process.

"There are huge amounts of money to be made or saved here, but only if you have access to the vehicle data," he says.

Image copyright Thinkstock Image caption In future, cars will warn us long before they break down

At the moment all cars have to have an onboard diagnostic (OBD) port. This allows mechanics to plug in a cable and access the data stored in the car's computer or electronic control unit (ECU).

Under European law every manufacturer has to fit one, primarily so testers can gain access to emissions data and check that the vehicles comply with pollution regulations.

But, obviously, mechanics can only access the OBD when the vehicle is stationary. So unless they can access this diagnostics data wirelessly, they say they will be at a competitive disadvantage.

The ACEA says manufacturers would be prepared to share this kind of data with third parties through their own cloud servers or via "neutral" servers operated by other companies.

But Mr Keaney says his members and vehicle owners would then have to go "cap in hand" to the manufacturers to access it, and would probably have to pay for it.

"Independent service providers will suffer and there will be less choice for consumers and vehicle owners," he says.

Image copyright Getty Images Image caption Would losing control of car data harm independent repair shops?

The UK's Society of Motor Manufacturers and Traders (SMMT) acknowledges that "overly restrictive access [to car data] may stifle innovation and competition, and restrict consumer choice".

"SMMT is currently working with all parties involved to ensure a better understanding of the issues involved, while a common solution is currently being discussed at a European level," says Tamzen Isacsson, director of communications and international.

The aftercare industry wants equal access to wireless in-vehicle data and believes the technology is already here that could provide it securely.

Public cloud providers like Amazon Web Services and Microsoft Azure run programs called hypervisors that create virtual machines on computer servers. These virtual machines enable many different clients to store their data safely and separately on one computer, thereby saving computing resources.

It's the technology that has enabled cloud computing to take off in the way that it has.

"Cars could also run hypervisors that allow virtual environments and enable third parties to access car data in a safe and secure way," says FIGIEFA's Mr Pattemore.

Several other industry bodies - Cecra, FiA, ADPA, Leaseurope and others - agree, saying that an "in-vehicle interoperable, standardised, secure and open-access platform" would be preferable to preserve a competitive market.

This may be a complex issue, but it could directly affect the pound in your pocket. Expect to hear far more about this in the months to come.

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When you turn 25 does car insurance go down Image copyright Getty Images

Average car insurance premiums could increase by up to £75 a year as a result of a government ruling, industry experts have said.

A new formula for calculating compensation payments for those who suffer long-term injuries has been announced by the Ministry of Justice.

But the Association of British Insurers (ABI) called the decision "crazy".

The Ministry of Justice said it had no choice under the current law, and said it would consult on possible changes.

Shares in insurance companies fell, with some saying that profits would be hit by millions of pounds.

The change is due to take effect from 20 March.

How compensation works

Accident victims are paid compensation in a single lump sum, which in serious cases is supposed to support them for the rest of their lives.

But someone who receives that lump sum can actually increase that amount by investing it, and getting a cash return.

So to be fair to insurance companies, the payout is reduced accordingly.

For the past 16 years the discount rate, as it is called, has been set at a typical rate of 2.5% - making the payout that much smaller.

Now the Ministry of Justice has decided to reduce the discount rate from 2.5% to minus 0.75%.

That will result in more money for the victim, but a higher cost for the insurer.

The change was ordered because the formula assumes the victim were to invest his or her money in government bonds.

By the time inflation is taken into account, real returns on such bonds have become negative.

'£1,000 increase'

Reducing the discount rate to minus 0.75% was a "crazy decision", said Huw Evans, director-general of the Association of British Insurers (ABI).

"Claims costs will soar, making it inevitable that there will be an increase in motor and liability premiums for millions of drivers and businesses across the UK," he said.

"We estimate that up to 36 million individual and business motor insurance policies could be affected in order to over-compensate a few thousand claimants a year."

Image copyright Getty Images Image caption The change will mean accident victims are likely to receive higher pay-outs

Experts said higher insurance premiums could cost drivers under the age of 22 up to £1,000 a year.

"We anticipate an increase of £50-£75 on an average comprehensive motor insurance policy, with higher increases for younger and older drivers - potentially up to £1,000 for younger drivers, and a rise of up to £300 for older drivers," said Mohammad Khan, UK general insurance leader at accountancy firm PwC.

Older drivers includes anyone over the age of 65.

However, accident victims are set to benefit as they will receive higher pay-outs.

Lawyers who had campaigned in favour of the changes welcomed the news.

"People already coping with the most severe injuries have been deprived of the help and care they need for years," said the Association of Personal Injury Lawyers.


A number of insurance companies said their finances would be hit as a result of the changes.

Direct Line said it expected its pre-tax profits to be reduced by as much as £230m.

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Where negligence claims are made against the NHS, the bill could rise by £1bn, the Treasury said.

But the NHS Litigation Authority will be compensated for any extra cost, the government promised.

The Ministry of Justice will now launch a consultation on how the system can be made fairer.

It said it would bring forward any necessary legislation "at an early stage".

In the meantime, it has made it clear it had no choice but to change the discount rate, according to the existing law.

"The law is absolutely clear - as Lord Chancellor, I must make sure the right rate is set to compensate claimants," said Liz Truss, the Lord Chancellor and Justice Secretary.

"I am clear that this is the only legally acceptable rate I can set."


Open public car park insurance bristol Image copyright Lutz Pathfinder Project Image caption The pods will eventually be able to be hailed by members of the public

A driverless car has been tested among members of the public for the first time in the UK, in Milton Keynes.

The two-seater electric vehicle travelled in a 1km (0.6-mile) loop on the pavements around the town's railway station.

The team behind it hopes a fleet of 40 of the pods will be available to the public next year.

It called the test "a landmark step" towards bringing self-driving vehicles to the roads of the UK.

Local dignitaries and members of the press sat alongside a safety driver, who was there to take the car out of autonomous mode in the case of an emergency.

Programme director Neil Fulton said: "This public demonstration represents a major milestone for autonomous vehicles in the UK and the culmination of an extensive project involving UK companies and experts.

Image copyright Lutz Pathfinder Project Image caption The response to the vehicle was "overwhelmingly positive" said the team behind it

The autonomy software running the vehicle, called Selenium, was developed by Oxford University's Oxford Robotics Institute and integrated by Oxford University spinout company Oxbotica.

Selenium uses data from cameras and LIDAR systems to navigate its way around the environment.

"Oxford University's technology will go on to power automated vehicles around the world, and the project will now feed into a much wider programme of autonomous trials across the UK," said Mr Fulton.

"Driverless vehicles are coming to Britain, and what we have demonstrated today is a huge step on that journey."

Virtual mapping

The UK government is keen to lead the way on the development of driverless car technology and earlier this year launched a consultation on changes to insurance rules and motoring regulations to allow driverless cars to be used by 2020.

It said it would allow such vehicles to be tested on motorways from next year.

The trial in Milton Keynes is the culmination of 18 months planning, which required a virtual mapping of the town along with extensive work with Milton Keynes Council to ensure the vehicles would be safe, conform to regulations and be accepted by the public.

Mr Fulton said that public response to the vehicles, which will be on show for three days, had been "overwhelmingly positive."

'Huge opportunities'

Business and Energy Secretary Greg Clark said: "Today's first public trials of driverless vehicles in our towns is a ground-breaking moment and further evidence that Britain is at the forefront of innovation.

"The global market for autonomous vehicles present huge opportunities for our automotive and technology firms.

"And the research that underpins the technology and software will have applications way beyond autonomous vehicles."

There are other driverless car trials being carried out, in Bristol and London. Both are likely to conduct public trials in coming months.


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