Car Insurance is still perceived by many to be something of a black art. Despite more openness from within the industry, user-friendly websites, punchy advertising and more apparent transparency, why does it still continue to come as a shock to many people when they receive an insurance quote for their new car?

Jim, a friend of mine, found his policy increased by more than £150 when he recently moved house. Geographically, he was moving seven miles, from one rural area of Wales to another. His nearest city was still some 35 miles distant. Unfortunately, on phoning his insurers, he discovered his new postcode district was Newport. This led to an increase in insurance premium for his vehicle, despite the fact that at his previous residence he kept his car on the drive at night, but now had the benefit of a locked garage. He was now living two miles up a mountain, with his closest hamlet a tiny village, where the last ‘grand theft auto’ was that of a bicycle by a drunken patron of the local boozer.

Jim doesn’t take security lightly – he has spent the time and money to ensure his car is fitted with the latest anti-theft devices, which reduced his policy by around 10-15 per cent. But what Jim can’t understand is why his car, fitted with the latest accident prevention technology, doesn’t qualify for another discount. If his car is also safer on the road, as well as when parked, surely he should be rewarded with an additional lower premium?

The motor industry has also noticed this anomaly and is calling for Thatcham (Motor Insurance Repair Research Centre) to include drivers with cars fitted with the latest safety gadgets to qualify for premium discounts on their motor insurance.

Years of research, development and huge amounts of money have led towards safer motoring and greater advances in safety. Electronic stability control systems (ESC) which prevent over and under-steer by braking individual wheels, together with ABS, another active safety system, have now been fitted as standard to almost all new cars. But these are just a few of the active safety technologies that help in preventing an accident.

Thatcham says that international insurance figures point to a 15 per cent reduction in damage costs where ESC is fitted. SMMT (Society of Motor Manufacturers and Traders) is therefore calling for Thatcham to pass these savings onto its members and offer 15 per cent off policies for cars with these systems.

“The car industry has invested significantly in passive safety systems, protecting occupants and pedestrians involved in accidents,” said SMMT spokesperson Nigel Wonnacott. “However, millions of pounds have also been spent on accident avoidance systems, like lane departure warnings, assisted braking, anti-rollover and adaptive headlights which have saved countless lives. They have also saved the insurance industry millions of pounds and it is high time that was recognised in cheaper insurance for customers.”

When Jim bought his car he made safety a major factor in its purchase. If he was prepared to spend the extra money on greater security and safer driving, shouldn’t he be rewarded with a lower premium?

The gauntlet has been thrown down to the insurers – but will they rise to meet it or continue to procrastinate? Insurers – it’s over to you…

I’m not holding my breath.