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		</div><p><a href="http://londonglossy.com/wp-content/uploads/2011/01/insurance-firms-in-pricing-probe.jpg"><img class="alignnone size-full" title="Seven insurance companies are being investigated over software which allowed them to access pricing information" src="http://londonglossy.com/wp-content/uploads/2011/01/min-insurance-firms-in-pricing-probe.jpg" alt="Seven insurance companies are being investigated over software which allowed them to access pricing information"/></a></p>
<p>Seven insurance companies &#8211; including UK giants Aviva and Royal Sun Alliance &#8211; are under investigation after the consumer watchdog raised concerns over the use of industry software which could lead to illegal price co-ordination.</p>
<p>The firms, plus two IT software providers, are being investigated by the Office of Fair Trading (OFT) over the use of Whatif? Private Motor, which allows insurers to access competing companies&#8217; pricing information.</p>
<p>The OFT warned any tool which dampens competition could lead to worse value for customers and potentially be a breach of competition law.</p>
<p>The companies involved, which include insurers Ageas, Axa, Liverpool Victoria Friendly Society, RBS Insurance and Zurich Insurance, and IT firm SSP, are proposing to address the concerns by committing to no longer access each other&#8217;s pricing through Whatif? Private Motor.</p>
<p>The OFT said the investigation potentially has wider implications as the Experian tool is just one of a number of similar products used throughout the insurance industry. It also said insurers were able to access information about their competitors&#8217; future pricing intentions before it was even available to brokers to sell to consumers.</p>
<p>Clive Maxwell, executive director at the OFT, said: &#8220;Active competition between firms drives better value for consumers and growth for the economy, and anything that potentially dampens that is a cause for concern.</p>
<p>&#8220;The OFT treats possible breaches of competition law very seriously, but we believe that formal commitments in this case would be a proportionate way of resolving our concerns.</p>
<p>&#8220;We used our discretion to limit our investigation&#8217;s scope in order to reach a quick and effective outcome. However, we are aware that similar market analysis tools exist both in motor and other insurance markets and we urge companies using them to ensure that they are complying with competition law.&#8221;</p>
<p>The OFT is consulting on a draft text of formal commitments being offered by the parties, which will allow companies to exchange pricing information through the Experian analysis tool only if that information meets certain principles agreed with the watchdog.</p>
<p>Commenting on the OFT&#8217;s investigation, the Association of British Insurers said: &#8220;As the OFT has made clear, it has not made a finding of an infringement of competition law. We welcome the OFT&#8217;s proposal to consult on an approach that has been agreed with some motor insurance companies to ensure that there is no concern about any infringement going forward. The motor insurance market is competitive and offers choice for customers.&#8221;</p>
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