Insurance Premiums Cost Is On The Rise Again!

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By Josh Brian
Marketing Apprentice

The cost of car insurance has just rocketed to a record high and is predicted to go even higher over the years to come. A double whammy of Insurance Premium Tax (IPT) and changes in pay-outs to crash victims mean the average driver is now shelling out nearly £500 a year for cover.

The average annual insurance premium was £436 in 2016; this has increased with statistics showing the average premium for 2017 is £484 according to the ABI (Association of British Insurers). More figures from the ABI show the average premium in the three months to June leapt by £48 to £484 a year. In June alone, the average premium reached £498 – with further increases to come.

From the data that has been collected we can see that this sharp rise in premium costs is the biggest in the 5 years that the ABI has collected the data and the main reason for this is government changes to pay-outs for crash victims.

In 2015 the volume of fraudulent claims rose by 6% in comparison to 2014, bringing the annual total to 130,000. The pay-out for fraudulent claims for the same period was £1.3 billion. This means that insurance companies need to recover the costs of fraudulent claims through more expensive customer insurance premiums.

ABI Director General Huw Evans said:

“The UK is one of the most competitive motor insurance markets in the world, but the unprecedented increase in claims costs is driving up prices to record levels.”

“Most younger and older drivers are likely to face increases even higher than this; hurting people who can least afford it.”

“Worryingly these increases are unlikely to be the end of the road if reinsurance premiums go up at the end of the year, adding further costs to insurers.”

Here at Connect we still pride ourselves on our customer service and finding the most competitive quotations, if you would like to speak to one of our advisors about our insurance services then please get in touch on 01782 200 715 or complete any of our online quote forms please click here.

Sources: The Mirror: Car Insurance Cost Just Rocketed