Brexit: fuel prices up and gender neutral insurance to be reversed?
The insurance and financial services provider below lists a number of effects of Brexit on motorists’ pockets.
The AA said that following the momentous decision for the UK to leave the EU, the value of the pound has fallen by more than 9% overnight and as a result, fuel prices are “likely to creep up.”
While The AA doesn’t envisage any immediate change to the current EU legislation allowing drivers to benefit from the minimum level of insurance cover when they legally drive in any other EU country, it added that this “could be withdrawn in the longer term”.
In December 2012 a new EU directive made it illegal for insurers anywhere in the EU including Britain to base the cost of insurance using gender as a risk factor.
That meant that the cost of insurance for men and women equalised – both for life insurance and for car insurance.
The AA said that potentially, this directive could be reversed following an exit from the EU. However, it added that it doesn’t believe the reversal of this directive is likely given that the industry has now “adapted well to the new ruling and there would be a significant cost to insurers to do so”.
There will be no immediate effect on British drivers taking their car over the channel and for AA members, it said roadside assistance on the continent would be unaffected. It added that it continues to work with the roadside assistance clubs across Europe and “will ensure that our members are not left stranded at the roadside”.
If you’re driving abroad, you must display a GB sign or face a fine if you’re caught without it. The AA says it’s unclear if the GB euro-plates will still be valid in the EU. Outside the EU, some countries still require a GB sticker even if you have euro-plates, so it is always safer to display one. The letters must be black on a white, elliptical background. They must be at least 80mm high with a stroke width of 10mm.
There is no change to travel insurance cover for travellers planning to go to Europe and existing policies will continue to be effective. Similarly, the European Health Insurance Card (EHIC) which provides reciprocal health cover in EU countries will continue to apply, said The AA.
At present border controls between the UK and other European countries exist but they are likely to become more onerous. While this might lead to greater delays for travellers and increased bureaucracy, it may have much greater implications for the freight transport industry. It could also lead to limits on how much ‘duty free’ could be brought home.
The UK’s only land border with an EU country – the Northern Ireland border – currently has no border controls which allows residents to cross the border at will in order, for example, to benefit from cheaper fuel prices in the eurozone. The AA said: “It’s probable that border controls will once again be imposed between Northern Ireland and Eire.”
Edmund King, AA president, said: “While the fallout of the referendum result will continue to be discussed, there are lots of points drivers will want to see resolved. As the voice of the motorist we will ensure that their views are heard loud and clear throughout the negotiation process.
“Driving abroad anything can happen but we would like to reassure our members with AA European Breakdown Cover that they will continue to get a first class service coordinated from our control centre in Lyon.
“Fuel prices will be the biggest immediate concern of drivers with the weaker pound and the Chancellor’s prediction that leaving the EU would lead to fuel duty increases. We will oppose duty increases and continue to monitor the situation on behalf of our members.”