Association of British Insurers says typical cover is now £462 as whiplash claims and tax hikes hit motorists hard.
Higher taxes and whiplash claims have pushed the average car insurance premium up by 8% over the last year, adding £34 to the average annual cost for drivers, according to the Association of British Insurers.
The increases takes the typical premium to £462, the highest level since the ABI started collecting the quarterly data in 2012. “This reflects continuing cost pressures around rises in whiplash-related claims, Insurance Premium Tax and increasing repair bills.”
Since IPT was introduced in 1994 at 2.5% it has been steadily increased by successive chancellors. It has been hiked three times in the past two years: the last rise of 0.5% took the rate to 10% while in June it will rise again to 12%, making “higher insurance bills for many look inevitable,” says the ABI.
But price comparison websites say premiums are higher than the ABI suggests. Confused.com said that prices have risen by 16% over the past year, with the average premium for comprehensive cover now £781. “Coupled with hikes in road tax for new cars and petrol prices rising since the start of 2017, it’s likely that many drivers will feel the cost of motoring burning a sizeable hole in their pockets,” said a spokesperson.
The change to the way in which compensation for serious personal injuries is calculated – the so-called Ogden discount rate – is also likely to lead to big additional costs, says the ABI.
“Further increases could come as insurance renewals are due in early July or at the beginning of 2018, feed through to premiums insurers have to charge,” said Rob Cummings, the ABI’s assistant director and head of motor and liability.
Ever stopped to wonder if your insurance policy purchased on-line is “fit-for-purpose”?
Of course the schedule of insurance will include all the usual …
19 Jul 2019
The 2019 Inspiring Herts Business Awards’ “Family Business of the Year Award” was presented by Peter Smits, Managing Director of Ashbourne Insurance …
10 Jul 2019
Business insurance for tradesmen can be a minefield to navigate through, not only is there a need to ensure that you obtain …
7 Jun 2019