Responding to a report from Thompsons' Solicitors on motor insurance pricing and ethnicity, James Dalton, Director of General Insurance at the ABI, said:
"Car insurers have never, and will never, set prices based on ethnicity as it is both ethically wrong and prohibited by the Equality Act 2010. Premiums are higher in certain parts of the country because claims costs are higher in certain parts of the country.
"This report was compiled without any consultation with the insurance industry, by people with no understanding of how car insurers price their policies and was paid for by a firm of solicitors with a vested interest in fuelling the compensation culture. Thompsons’ report makes serious accusations using a flawed analysis and based purely on a statistical coincidence. This is the same as saying there is a causal link between margarine consumption and divorce or murder rates and ice cream eating.
"The reality is there is a whole range of factors, including postcodes, vehicle type and age that insurers base their insurance premiums on. The car insurance market is highly competitive and customers should always shop around to ensure that they are getting the best deal for them."