6 Conclusion
53. Although
the Government is not responsible for the cost of motor insurance
there are several good reasons for it to be concerned at the recent
increases in premiums for what is a compulsory requirement on
drivers and we have identified a number of actions it can take
to help bring premiums down. In particular, the Minister pointed
out that other departments are responsible for issues such as
referral fees and action against insurance fraud but we look to
him to press the case across Whitehall for the measures we have
recommended. Within his own remit, the Minister has already acted
decisively to help reduce uninsured driving. We now look to him
to turn his attention to making the driving test more rigorous
and bringing down the casualty rate amongst young drivers, something
which in our view should be central to the Government's forthcoming
road safety strategy.
54. The insurance
industry also has a big part to play in bringing premiums under
control. If referral fees continue they should be more transparent.
We are not convinced that the increasing prevalence of referral
fees throughout the sector has left premiums unaffected and we
suspect that the market will be less "dysfunctional"
if consumers have a better grasp of where their money goes. We
would also like to see the insurance industry do more to tackle
fraud. The Department for Transport should bring pressure to bear
on the main players to work together, and with the police and
other authorities.
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