Ditching extra insurance premiums for volunteer drivers was long overdue

There was a certain amount of backslapping this week when
the Association of British Insurers announced that 54 insurance brands would
no longer be charging extra premiums for people who use their cars for
voluntary activities, such as taking people to hospital or on days out.

The insurance companies presented it as an act of generosity
– of giving something back – and the Minister for Civil Society, Nick Hurd,
claimed it as an early win for Lord Hodgson’s recent report on cutting red tape
in the sector. The report pointed out earlier this year that the extra premiums
put people off volunteering.

I’d like to be impressed, but I’m not. Why did some
insurance companies ever charge extra premiums for volunteer driving in the
first place? Their argument that it wasn’t normal social use was surely
untenable: you could hardly have a better definition of what is ‘social’ than
people doing things for others in their community.

It’s tempting to think this was just another of those little
sleights of hand – those nice little earners – for which this industry is well
known. Having said that, it’s a reasonable surmise that their readiness to make
this concession indicates that in practice it may not have been much of an
earner at all.

It’s surely likely that a lot of people – justifiably
assuming that they were covered by a normal policy – were just doing volunteer
driving without telling their insurance companies. Hodgson’s report also
indicated that the premiums often caused arguments, and the companies may have
felt any extra revenue was not worth the hassle.

Nonetheless, it’s good news. It would be welcome to get similar
progress on another recommendation of the red tape report – a code of practice
for the insurance industry on health and safety for businesses and the
voluntary sector. This is intended to address the concern that charities
operating in “low hazard environments’, as the report puts it, are required by
insurers to employ consultants to carry out full – and expensive – health
and safety risk assessments. 
Progress on this one might take a little longer.