The epitome of freedom could be seen as owning a motorcycle. We can all conjure up images of legendary motorcycle marques, routes, and motorcyclists across the eras. Such a freewheeling lifestyle could easily become full of bitter regrets however should the right kind of insurance purchase not accompany the procurement of the bike.

Fully comprehensive, third party only, or third party fire and theft choices exist to allow the motorcycle owner to choose which level of investment best suits their needs, lifestyle and aversion to risk.

Motorbike insurance can further add flexibility to your lifestyle as both web-based and telephone take-on of insurance can give you peace of mind from day one. British-based call centres and online providers allow for 24 hour service, advice, updates and claims administration.

Recognising that for some buying a bike represents a more economical way of making their transport budget go further, as well as that for others their motorcycle is not their primary vehicle and is therefore a significant other investment, flexible payment solutions for motorbike insurance exist. For better budgeting, payments can be tailored to your needs, even being spread over twelve months for the annual premium.

Motorcycle insurance can also give you the liberty to use your bike as way to explore and find new horizons. Travel with your bike can bring ultimate freedom if you choose an insurer offering travel and continental cover.

Whether your motorbike is your way to work or your weekend wonder, theft remains an issue. Motorcycle insurance is the obvious choice to avoid any financial shock should your bike unfortunately be stolen and not recovered. Market-value payouts mean that you will be able to replace your motorbike at your own convenience.

It is not just financial stress that may be suffered if you neglect to purchase insurance when your purchase your bike. Loss or damage to your motorcycle is also inconvenient. Motorcycle insurance can give you the ability to cover the cost of repairs as well as replace the bike should it be stolen, damaged or destroyed. Transport to your closest garage for repairs can also be included in your policy to remove some of the inconvenience from your nasty experience.

The freedom of the open road beckons with a bike. That however is no excuse to ride without an appropriate level of motorbike insurance. Indeed, purchase of a policy in tandem with your bike actually frees you up to go wherever you want.

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Notice the position of the apostrophe there.

I am sure you have all seen the outcome of the European Court of Justice case 1st March to establish whether insurers are allowed to take into account sex as one of the many risk factors they use in calculating premiums.

From 2013 it will be an illegal act if insurers use sex as a risk factor.

This is not great news for specialist insurers like Sheilas’ Wheels who have taken the initative in offering preferential rates to women drivers.

Whilst this may be another good step on the way to creating true equality it does raise some interesting issues for the whole concept of insurance rating, an art grounded squarely in the statistics of risk-avoidance.

Traditionally insurance premiums are calculated to reflect the risk that is being taken by the insurer. To calculate this risk many factors will be taken into account such as claims costs and expenses already paid out, trends in certain areas and age groups, type of vehicle, security fitted and of course a profit margin for the insurer.

In assessing the level of risk insurers will look at the breakdown of claims paid into different groups – and of course sex has always been one of these.

There is no denying what the statistics show: male drivers, especially the younger ones do have more accidents per capita in comparison to their female risk equivalents; i.e same car, same area, length of driving experience.

• Men are 3 times more likely to be involved in a fatal car accident than women;
• Men account for 80% of speeding fines in the UK;
• 44% of men have used a mobile phone whilst driving compared to 30% of women;
• 20% of men have fallen asleep at the wheel compared to just 6% of women;
• In 2003 93% of convicted drink drivers were men.

These statistics would seem to suggest that the sex of a driver is a reasonable way for an insurer to assess the risk they are accepting and should not be looked at any differently to any other underwriting consideration.

What on earth next?

This is not NG1.

Am I missing something?  Is it the maths here that’s being sexist or the mathematician?  Perhaps we could help the statistics to be less narrow minded by dropping in a few extra numbers?

The EU ruling rather makes one think this madness might spread to other classes of insurance as well.

Is it fair for example to charge a 50 year old man more for life insurance than a 45 year old?  Whichever way you look at it this is age based discrimination, for good or for bad.  What about charging higher premium’s against theft in Nottingham’s infamous NG1 postcode area?  Is this discrimination against the people of Nottingham?  Yes.

But whilst it’s discrimination it’s restricted to a very narrow band.  If NG1 residents go looking for non-theft insurance for instance they won’t be subject to the same maths.

And maths is exactly what it is.  As far as I’m aware the actuaries who come up with these algorithms don’t actually have anything against men, old people or the unwashed students delightful people living in NG1.

Insurance Theory and Discrimination are the same thing.

In researching this article, I amused myself (somewhat) by checking the Wikipedia definitions for both “discrimination” and “actuarial science”.  It seems that:

“Discrimination” is the cognitive and sensory capacity or ability to see fine distinctions and perceive differences between objects, subjects, concepts and patterns.

“Actuarial science” is the discipline that applies mathematical and statistical methods to assess risk in the insurance and finance industries.

There’s certainly some common ground there.  Can either exist without the other?  You might forgive me for thinking “No” and asking “Where will this end?” !

The nasty conclusion

Having been given a situation where they cannot charge a woman less – which ought to mean they should charge a man less as the risk is the same – insurers will predictably increase women’s premiums rather than reduce the men’s.

There is no logic to this approach outside of plain old fashioned (albeit mercenary and unfair) commercial practice;   if insurers were happy to accept a premium for a woman driver and now have the same details for a man, beyond any doubt the man’s insurance should reduce.

There has been no increase in risk for the woman driver so what is the justification for increasing their premium?  Unfortunately the reason for the increase is that the premium for men cannot be decreased in line, because they are the ones making all the claims

Perhaps it’s been a bit of a sour victory for equality if men are still being proven to be more dangerous drivers and women are paying the price.

And once again insurers have done nothing to improve their image.  It was a great marketing opportunity missed but perhaps one that not even they could afford given the risk involved and the overwhelming maths.

I leave you with a quote from Lord Davies of Stamford speaking in the House of Commons 1st March:

“it is a pretty remarkable day when an insurance market is instructed to operate contrary to actuarial principles”.

Perhaps we will be seeing more remarkable days in the years to come.

—

As always, I’d love to know whether you agree.  Has the ruling affected your business or your premiums?  Let me know!

Pressure is mounting today on Alistair Darling as voices from within the industry call for his resignation over after it is alleged he compared the insurance industry to a “Ponzi scheme of Madoff proportions”.

Darling’s press office immediately responded to the allegations by releasing a statement, claiming “Even if Alistair did make these comments (and we’re not in a position to confirm or deny this), what people must try to remember is this Government is here to serve the people and that the Chancellor is no more expected to understand economic theory than the Prime Minister is expected to demonstrate competent leadership or understand foreign policy.”

Mr Darling was unavailable for comment, however sources close to him say he is “nonplussed” by the whole affair and is rumoured to have spent the day in an undisclosed location playing table tennis with Ed Balls.

Gordon Brown, during his weekly spot on Piers Morgan’s evening talk show (“Things can only get better”), broke his silence on the issue stating that “I never liked him anyway”, when, in a controversial and unprecedented move, Piers invited him to talk “about the issues and not focus on the vastly insignificant personal angles”. The Prime Minister responded, stating that “[we] have consulted several expert lobbyists for the insurance industry and they assure me everything is just fine. What more can we do?”. The FSA was not mentioned, presumably because they’re now well known to be about as useful as a one legged man in an arse kicking contest.

As more and more tabloid pressure mounts on Darling, it would appear his support from the political giant that is Gordon “We saved the world” Brown is beginning to wane. Insider sources within government say “This is a tipping point for Darling, and the moment we locate the Cabinet, action will be taken…”

Amazingly a single gang of travellers are said to have been the root cause of 47% of all insurance claims for caravan theft.

The BBC cite the Wiltshire gang as having been responsible for – wait for it – HALF of all the caravans stolen in the whole of the UK between 2004 and 2007.

They really must dig caravans.

How about some mugshots?  Here you go:

Astonishing. It took 19 police forces across the UK to arrest them. Here’s a sample of some of the action:

Today they are safely behind bars. Phew. Your 4 berth, Fixed Bed, Full awning 2006 Ace Jubilee Statesman is safe.

Remember, you saw it first on RiskHeads (probably).

On behalf of RiskHeads.org I’d like to say a big thank you for our mention in the Top 10 Insurance Blogs over at Insiders View. THANKS guys.

Since our recent launch we’ve been pleased by the massive feedback we’ve been getting from readers and to see RiskHeads up there already with the likes of Times Online and The Guardian gives us all a warm fuzzy feeling inside.

So our biggest thanks has to go to our readers: thanks for your continued support!  Let us know what you’d like to see here and we’ll get it done for you.

The BBC have an interesting article describing how technology has once more made the previously uninsurable, insurable.

I quote:

“A new insurance scheme has been launched in northern Kenya which offers herdsmen a chance to protect their livestock against drought.”

Click here to view the  full article:
http://news.bbc.co.uk/2/hi/africa/8475548.stm

Let us know what you think. Will everything be insurable one day?

The human brain is a marvellous thing.

I’ve been typing a lot today, so much so that my thumb has started to hurt. So I’ll keep this short.

What amazes me is that I was able to think ‘OK, so I’ll just stop using my right thumb’ and I then continued typing for the next hour without using it, without creating loads of mistakes or even slowing down too much. How exactly?

Working on the rules engine for our insurance software today makes me appreciate just how extraordinary it is that the brain can accept rules into the subconscious and then start processing them without so much as a hickup, any formal, lengthy definition, or any forethought or planning. The rules we give our brain on a whim can cover just about anything and almost always work perfectly. In fact, we can make them work better by thinking harder: if I want to make sure I type 100% correctly without using my thumb I can do it, or I can type really fast and the rule is only loosely applied. It’s like there’s an Importance level we set for these ad-hoc rules.

They even work at times like this where they affect a completely subconscious activity like typing. Does that mean I could learn to breath differently? Probably. There are plenty of people that learn to walk in silly ways.

I’m certain that with our rules engine we need to emulate the brain; that’s our real competition, not other software systems.

According to Brian Duperreault during his speech at the Rendez-Vous de Septembre reinsurance meeting in Monte Carlo:

“It’s instant gratification. When you bind a big piece of business, as a broker you celebrate. As a carrier, you don’t know whether to laugh or cry.”

Thanks to Regis Coccia for the original post over at Business Insurance.  (He’s looking after Sally’s column while she’s away.)

The Insurance Institute for Highway Safety crashed a 1959 Chevrolet Bel Air into a 2009 Chevrolet Malibu to ‘celebrate’ their 50th Anniversary.

Malibu and Bel Air Crash - both deserve their fate...

Must have been some party. I wonder whether they planned it or someone had too much fizzy pop.

The original video posted to YouTube was here but seems to have been taken down for some reason, but there’s a fresher copy here.

Feel free to add more links to the video or similar videos in the comments.

What do you think, was this a bit of a sick way to celebrate for a safety agency, or was it a scientific tribute to man’s great progress?

MORE THAN Living have a video on YouTube showing the most common crashes that insurance fraudsters stage to make fraudulent motor claims.

It’s done Postman Pat style, though without any style. Might be useful though.

Instructions for how to commit insurance fraud by MORE THAN? Or a stern warning?