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Some of you may  remember the Prime Minister declaring recently "We have helped to reduce car insurance premiums by reforming 'no-win, no-fee' agreements". Well; now the industry has said 20% cuts are possible, but only if young drivers are dealt with. 

If former Justice Minister Jonathan Djanogly is to be believed, "the eyes of government" are on insurers, in the wake of the Jackson reforms which have undoubtedly tipped the balance of power in favour of defendants. As a result, the pressure appears to be on the insurance industry to deliver cheaper premiums now that its lobbying activity has delivered and insurers may at long last be prepared to promise actual reduced premiums. However it's got nothing to do with saving money on legal costs or referral fees; their plan is based on generating a return on further wholesale reform, this time by overhauling the driving test. 

When they reported on the news, the headline writers picked up on potential reductions of 15-20% which got everyone very excited indeed. However something slightly more equivocal emerged from Keith Morris, chairman of the Motor Insurers Bureau and chief executive of motor insurer Sabre. Following a meeting with Transport Secretary Patrick McLoughlin on 25th March, he said it is difficult to quantify the premium reductions for young drivers, telling Post Magazine: "The industry has pledged to pass back any premium as a result of a reduction in claims. It's too early to tell what the reduction will be but as we get certainty in a reduction in claims we will see premiums dropping slightly." 

There will be a further debate on road safety in the commons on 25 April and we'll keep you updated on this issue. 

Moving on… the driving test is about 100 years old; as was the old Marine Insurance Act 1906, which informed pretty much all consumer insurance contracts in this country until last Saturday. Yes, more than a century of settled case law has been thrown out in favour of a 'don't ask, don't get' regime governed by the new Consumer Insurances (disclosure and representations) Act 2012. This was passed into law on 6th April with something of a whimper, but may represent the single biggest change to how the public does business with insurers in, well, 107 years. Put simply, we, as consumers can now expect a more favourable treatment at the point of claim owing to the fact insurers must ask practically every question under the sun when we buy a policy or risk being unable to avoid that claim with the old defence of 'misrepresentation'. 

Insurance lawyers have been banging the drum for some time on this one because the filing cabinet marked 'claims rejected' could be about to start shrinking…watch this space.