I bet that if you were to ask any given driver in the United Kingdom what their insurance would be to drive a Lamborghini, they couldn't accurately answer this question based on their previous experience. In fact, the driver may not even know that they have to be 18 years old or older in order to drive a Lamborghini. The same drivers could also give incorrect answers when asked about their insurance for a Porsche, Nissan GT-R, or Volvo S60. This is because individuals (and as a result, society as a whole) lack sufficient knowledge to make informed insurance decisions. Insurance education is not currently embedded within the UK’s compulsory education system. As such, many adults experience information asymmetries and information asymmetry is a cause of failure in the insurance market. It has been suggested that "consumers and businesses tend to under-insure because of either lack of knowledge or lack of incentives to become informed." However, there are ways to mitigate this problem - one way being improved insurance education during both compulsory and post-compulsory segments of an individual’s life. Consequently, this presents an opportunity for the UK government. Through the provision of appropriate insurance education, the government could reduce asymmetric information and subsequently increase market efficiency. Consequently, the Government sees the need "to educate consumers to make informed decisions for themselves and society at large". It is stated that customers are ‘let down’ by the lack of quality information available to them. To address this problem, it has been suggested that insurance education initiatives should be implemented in the UK swiftly. The UK Government has set up an Access to Insurance Task Force (AITF) to promote insurance education in both compulsory and post-compulsory segments of an individual’s life. The Task Force has been tasked with "promoting the uptake of appropriate insurance education both directly and indirectly". Through implementation of appropriate insurance education, the Government could reduce asymmetric information and increase market efficiency. The Task Force is comprised of a mixture of individuals from industry and academia, who have expertise in insurance education. The UK government has committed funds to the implementation of the AIDTF’s recommendations. However, as previously stated, there are concerns as to whether these proposals would be implemented effectively due to their implementation being largely voluntary as opposed to compulsory as suggested by previous UK governments. It remains unknown how effective the government’s initiative will be in practice due to its homogenous nature. The UK government has set out to address this problem through the implementation of appropriate insurance education initiatives in both compulsory and post-compulsory segments of an individual’s life. The Access to Insurance Task Force (AITF) is focused on implementing appropriate insurance education to reduce asymmetric information and increase market efficiency. Under the government’s proposals, it would require motor insurance providers to develop a minimum amount of educational material for drivers. This material will be "provided free online or by telephone, post or email". The UK government hopes that this initiative will result in consumers being able to make informed decisions regarding motor insurance. 81eaaddfaf 20
- joimaberlicetomc