And now back to my original question – what all that fuss about Insurance Premium if we have just established that even vehicles over £70,000 can be insured for £500-700 per annum? Am I correct to assume that premium will be circa £20-£30?
TBH I don’t think it was clear what you were asking, hence @wmcforum response. I’m still not entirely sure what you are asking. Are you referring to the changes from July? If so, that less about premiums and more about the government adding Insurance Premium Tax (12%) to Motability. As it’s a block insurance policy, the whole scheme is insured, rather than individual cars and drivers, so the effect per driver (given that the cost of insurance per driver will be significantly less than if all those drivers insured individually) is going to be relatively low, so your £20-30 p.a. is probably about right.
However, I believe that Motability are hoping that the other changes that they are bringing in (removing overseas cover etc) may be able to offset most or all of that cost. The bigger issue is likely to be the 20% VAT on advance payments. I suspect that the majority of that will be passed on to customers through the ever increasing APs.