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An increase in excess from £10,000 to £100,000 – this is just one of the insurance woes sidetracking Edinburgh Trams. Add to that a near doubling of insurance premiums and a “poor” claims history.
According to HeraldScotland, total premiums for the initial four years reached £807,609, while the contract for the next three years has an equivalent value of £1.4 million. Tax rises have been cited as a chief driving factor.
“The claims history for this policy is poor and this allied to the uncertainty around the outcome of litigated claims involving injury to cyclists was likely to make the policy unattractive to insurers and would lead to premiums increasing significantly,” the report quoted Edinburgh City Council executive director of resources Stephen Moir as saying.
He explained: “Due to the poor claims history, the uncertainty around litigated cyclist claims and the fact there have been three rises in Insurance Premium Tax in the last two years from 6%, to 10% and then 12% and with further rises likely, the council had budgeted for an increase to current premiums with annual indexation.”
The report added that, so far, none of the cyclist claims had been settled.
