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Cost of car insurance continues to rise

August 2, 2016 | By | In Advice

The cost of the average car insurance premium continues to rise according to new research released today.

The typical quote for someone shopping around for cover in the second quarter of 2016 rose by £12.56, or 2.3 per cent, to £568.48.

Quarterly results over the last year have seen the average rise and fall. However, when you take into account the 12 months ending 30 June 2016, the average car insurance premium policy has risen nearly £84, or 17.2 per cent.

The figures were announced in the latest British Insurance Premium Index, produced by the AA. Its figures are based on an average of the five cheapest car insurance quotes given to a customer both directly and via comparison sites.

Michael Lloyd, director of insurance at the AA, comments: “Premiums have not risen by as much over the second quarter as some commentators predicted although it’s still an upward trend that I expect to continue over the rest of the year.

“For example, increasing numbers of car owners shop around for their cover every year, especially at a time when premiums are going up.

“As more people look for introductory offers there is less incentive for companies to offer loss-making prices to attract new business that will, a year later, go elsewhere. So I believe this is one driver of recent premium increases while insurers are looking for ways to better reward customer loyalty.

“Nevertheless, false or exaggerated claims for whiplash injury remain unacceptably high, thanks to the persistence of cold-calling claims management firms; rising costs of crash repairs as vehicles become more complex and a rise in uninsured driving all keep premiums higher than they should be.”

Jack Evans

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After completing his university studies in English and Creative Writing in Cardiff, Jack is now a full time motoring writer at Blackball Media. His love of cars stems from his childhood years when he began to live and breathe all-things automotive.

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