Insurance: why is it so expensive?

Insurance: why is it so expensive?

Insurance problems drive many readers mad and Connexion receives numerous queries on policies, premiums and problems.

Insurance problems drive many readers mad and Connexion receives numerous queries on policies, premiums and problems. Now, with the summer weather meaning more people are taking to the road, we find answers to some of the most common of your questions

Insurance is expensive

Why is car insurance in France so expensive (compared to the UK)? BS

This is quite a subjective question to answer as, of course, it depends on where you lived in the UK compared to France as well as your use of the car. There are three main differences in French insurance that could explain a difference in price if you are experiencing this feeling.
* The maximum No Claims Bonus in France is 50% whereas I commonly see between 65% and 75% reductions in the UK
* In France the insurance is on the car; so once insured anyone with a valid licence may drive your car unless specifically excluded (this usually means liable to a higher excess rather than complete exclusion)
* Breakdown assistance is included in most insurance companies quotes.

Insuring a UK-registered vehicle

What is the situation if you are driving a UK-registered car on French insurance and have an accident? Will the insurance be deemed null and void because you have not yet changed over to French plates? If this is so, why do French insurance companies offer insurance cover without telling you about this? DG

Firstly, this is not a reason for the policy to be deemed null and void. Some companies will only issue a temporary green cover note while your car is on foreign plates, some will not insure you and others don’t ask the question.

However, if you do have a claim while on foreign plates then, from experience, I can say that there are some differences compared to an accident involving a French plated car.

If the car is deemed a write-off then the process of selling the wreck is much slower as it cannot be automated by the assessor or the holding garage. If the car has been stolen in France then the French authorities require you to theoretically re-register the car in France, that’s to say, provide all the necessary paperwork to put the car on to French plates so that it can be entered into the French database of stolen cars. In both cases the claims were honoured but with an additional delay.

The only time a policy would be considered null and void would be for fraud or a false declaration.

If your insurer wishes to cancel your policy for any reason then they must do so by registered post and they must leave you a reasonable period to find alternative insurance.

Using a UK No Claims Bonus

Can you import your no claims bonus from UK to France? Does it work the same? SS

The system is, like most things in France, similar but contrary.

It starts with a coefficient of 100 (full price of the premium) then, after one year of claimfree driving the 100 is multiplied by 0.95 and the premium is multiplied by this reduction 0.95 to give the second year’s premium.

The 0.95 is roughly equivalent to a 5% reduction each year and this formula is repeated for another 12 years until full no claims bonus is achieved at 0.50 or 50%.

If there is a fault claim then the current no claims bonus is multiplied by 1.25 for fully responsible or 1.125 if partially responsible. So, 0.50 multiplied by 1.25 would be 0.62 (rounded down) equivalent to 38% NCB. The coefficient for fault claims can never be more than 3.5 times the premium but it would take a lot of claims to get there.

As for importing your No Claims Bonus, most companies will accept proof of your UK NCB – but it is worth explaining to them that 65% NCB is better than 50% so that they don’t attribute 0.60 as I have seen a number of times. All insurance claims are logged on a central claims list called AGIRA.

Cancellation dates on contracts

I got insurance from an English-speaking agency but am now in dispute with them after I left due to a series of problems. Despite never having mentioned the long cancellation period for contracts, they said their policy still covered me and sent a €600 demand for a full year’s premium.
The agency advertises itself as providing a “service in English” but never provided any of the supplementary documents in English. I have no issue with this as we are in France, but they gave no advice on other insurance pitfalls, like the long cancellation period they were now using.
I finally left when renewal notices were sent after the renewal date, and I found my premiums were double the average.
Recently the old company has called in a debt collection agency who send intimidating letters for payment. I am refusing to pay on principle. I believe I have the right to go elsewhere immediately, if necessary, if I get bad service. AB

I have had a number of questions about cancellation dates and English documents versus French which I will attempt to answer here.

However, as regards English-speaking insurance agencies, they may provide you with the general or personal conditions translated into English – but insurance is always regulated by the French insurance code and the French version is always the reference in case of dispute.

The advantage of an “English agency” is as much for highlighting the insurance differences between the UK and France.

As for contract renewals, most contracts in France (insurance, telephone, broadband etc) have an implicit renewal clause in them. The reason is to protect the consumer so there is no lapse of service. In each, the amount of minimum notice is specified. In most cases it is two months and the accepted method of cancellation is to notify by registered post.

However, the start date may not be the same as the renewal date: some companies renew all contracts on the first of the month while one renews all policies on the first of April regardless of the start date.

The Loi Chatel was added to consumer law in 2007 and allows you to cancel by registered post up to 20 days after receiving the renewal notice. The 20 days starts from the envelope postmark, not the date on the notice.

Once the insurer receives the cancellation letter they will either cancel for the renewal date if received before, or the following day if received after the renewal date.

As an example: I get my renewal notice on December 26, postmarked Dec 23, with the letter inside dated Dec 5 and the renewal date is January 1. Under the Loi Chatel you can send a cancellation letter to cancel the policy up to 20 days after the postmark date. If the insurance company receives it before Jan 1 it will be cancelled for Jan 1. If later, for example on Jan 5, they will cancel it for the next day, Jan 6 in this case. Cover for the period Jan 1 to Jan 6 is down to the old insurance company.

Car is insured not the driver

I’m told anyone insured in France can let anyone else drive their car without having to tell the insurer? Does the same system of named drivers work as in the UK?

The fundamental difference is the car is insured using the main driver’s insurance history. Once it is insured anyone with a driving licence may drive it and be insured. However, it would be the No Claims Bonus of the main driver that would be hit in the case of a fault claim. Be aware that most insurance companies apply a significant excess if the driver at the time of a fault claim has had their licence less than three years and is not insured as a main driver of another car in their own right.

Drive less and cut premiums

I do not drive very much, perhaps only about 4,000km a year: is it possible to pay insurance by the kilometre? If so, I think this could reduce my premium. NH

Yes it is possible: most companies have an option around 8/10,000 km of which you can expect a 15 to 25% reduction in your premium. If you feel that you are going to exceed your allowed kilometrage you must notify the insurance company so as not to invalidate or suffer a reduction for any future claims.

Right-hand drive vehicles

How much extra can you expect to pay for insuring a right-hand drive car compared with the same model left-hand drive? PD

Contrary to the UK, there is no notion of LHD or RHD in the weighting of the premium in France.

Registering and insuring trailers

We brought a trailer from the UK and use it frequently. It had UK number plates to match the UK-registered car and when we re-registered the car in France we bought matching number plates for the trailer. We have been told the trailer should have its own registration documents and separate number plates. What are the rules regarding registration/insurance for trailers? FG

There are three areas touched on here, the first being insurance.

The trailer: it needs a distinct insurance policy by law when the total permitted weight is greater than 750kg.

Number plate: if the trailer has a total permitted weight greater than 500kg then a separate registration plate is required. If 500kg or less then it takes the car’s registration.

Driving licence: if you have a French driving license then there are separate categories:
* If the trailer’s TPW is less than 750kg then category B
* If the trailer’s TPW is greater than 750kg but less than the towing vehicle’s empty weight then category B, with a maximum TPW combined (car and trailer) of 3,500kg * If this amount is exceeded then a category E licence is needed. Category E means a medical every five years if under 60, every two years between 60 and 75 and every year thereafter.

Maximum NCB and no more

I keep getting emails offering quotes on car insurance but, in France you cannot change until your current policy is due for renewal. If this were to alter it could create more competition and possibly better prices. Also companies do not recognise or reward accident-free drivers once they reach the maximum of 50% No Claims Bonus. I have not been able to find insurance with NCB of more than 50% – can you help? JM

The No Claims Bonus system is highly regulated in France. It takes 13 years to achieve full no claims bonus at a reduction rate of 5% a year. Contrary to the UK, it is the same rate for all insurance companies, which facilitates the transfer of your NCB.

Some companies give a price or loyalty reduction over and above 50% but your official NCB will still be 50%. Some companies will offer a “reward” in the form of protection in case of a fault claim whereby the no claims bonus will not be affected.

Car is garaged and off-road

What is the situation regarding insurance for a UK car that is in a garage and disabled so it cannot be driven? In the UK it is not necessary to have a car taxed or insured if it is off the road and cannot be used. KL

When you say UK car I have presumed UK registered. There is no option of a SORN (Statutory Off Road Notification) in France. Insurance law states that a vehicle with an engine must be insured third-party at all times. European law states your car should be re-registered in France as your intention is to have it here more than six months in the year.

This means the situation you have described is not possible. I would suggest to either SORN in the UK and leave it in the UK or reregister the car in France and insure at least third party with a limited mileage.

Uninsured drivers' liability

I heard an item on the radio which sounded as if it said damages and costs awarded by a court against an uninsured driver (including hospital costs) could amount to several million Euros and this debt was “hereditary” and would pass to the inheritors of the estate of the uninsured person on their death. Is this correct? IS

You heard correctly! If you cause an accident and are not insured you are still liable for all the costs claimable.

There is a collective fund into which we all pay via a tax on the car insurance that will indemnify the victims immediately and will then reclaim the money from the guilty party.

It is also true that debt can be passed down the generations just as much as assets – descendants can refuse the inheritance of course. The Connexion July 2012 www.connexionfrance.com Driving special 21 why is it so expensive?

Answers from Trystan Street,
Agent général d’assurance,
BML AngloAgence, Dinan, Brittany
www.angloangence.com 02 96 87 21 21

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