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Car insurance premiums rise by £39 in a year

Car insurance premiums rise by £39 in a year

Category: Car insurance

Updated: 10/08/2016
First Published: 10/08/2016

MONEYFACTS ARCHIVE
This article was correct at the time of publication. It is now over 6 months old so the content may be out of date.

Car owners are being urged to shop around for their insurance after the latest figures from insurance trade body the Association of British Insurers (ABI) revealed premiums had increased by 10% in the past year.

According to the data, the average premium paid in the second quarter of 2016 was £434, some £39 more expensive than a year ago.

Premiums have also been on the rise in the past few months, increasing by £5 compared with the first three months of 2016.

Increases in Insurance Premium Tax (IPT) and the rising costs of personal injury claims have both been blamed by the ABI for placing ongoing pressure on premiums.

Rob Cummings, ABI's manager of general insurance, admitted motorists are experiencing "tough times" and has called on the Government to crack down on the 'compensation culture' which he believes is pushing premiums higher.

"Despite a highly competitive market enabling motorists to shop around for the best deal, cost pressures on premiums caused by the Government's increases in Insurance Premium Tax and an increasing overall cost in lower value personal injury claims are feeding their way through into higher motor insurance premiums," he added.

"With a further increase in Insurance Premium Tax announced last October, it is imperative that the Government pushes ahead with proposed reforms to tackle the compensation culture by limiting compensation for low value whiplash claims, so that savings can be passed onto consumers through lower premiums."

Only last week, separate figures from the British Insurance Brokers' Association (BIBA) and Acturis' latest Insurance Price Index revealed a "significant rise" in the cost of premiums charged for private car policies.

The unfortunate upwards trend in premiums only makes it more important than ever to shop around for car insurance, and secure the cheapest premium possible.

Disclaimer: Information is correct as of the date of publication (shown at the top of this article). Any products featured may be withdrawn by their provider or changed at any time.

 
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