Car insurance premiums rise to a whopping £481; a 9% rise

The Association of British Insurers (ABI) has today released the latest information regarding motor insurance in the UK. Unfortunately for British motorists, the cost of insurance has gone into overdrive, as premiums reach a substantial new high of £481. The average motor premium has risen by 9% in 2017, which is to date an all-time high, adding almost £40 to the average insurance policy.

To achieve such results, the ABI has a Premium Tracker, the only market survey which measures accurately the prices consumers are paying to cover their vehicles. The tracker show more precise data, as it does not take into account quotes, just purely what consumers have set up in the way of direct debit payments or having paid their insurance policy in full when taken out. The full press release shows that in the fourth quarter of 2017:

• The average price paid for comprehensive motor insurance was a whopping £493. This figure was up 6% since 2016 for the same quarter.
• The average premium paid by consumers for the whole of 2017 was £481 – 9% higher than the same period in 2016. The Premium Tracker had been collecting data for the premium since 2012, which had shown a £40 increase.
• The average cost of motor insurance for consumers in the UK had risen by 29% since 2014; a significant financial strain for many.

And in turn for their results, the ABI are urging the government to help reduce the cost of motoring insurance. They are proposing the following:

• Introduce the reforms as to how compensation for large personal injury claims are awarded is adjusted in order to make sure there is a fairer system for all insurance customers and for those claiming.
• Pursue the reforms to how lower value whiplash-style claims are dealt with. Since 2013, drivers claiming for whiplash from accidents has increased significantly.
• Freeze the rate of Insurance Premium Tax, which is at the moment 12%.

Rob Cummings, ABI’s Assistant Director, Head of Motor and Liability, has commented:

“The rising cost of motor insurance shows no sign of abating. Changes to how compensation pay-outs are calculated, Insurance Premium Tax, more whiplash-style claims and rising repair bills are all piling on the pressure for cash-strapped drivers.

“The Government must urgently bring forward relief for motorists by introducing its reforms to create a fairer compensation system, and tackling low value whiplash style claims without delay, as well as freezing Insurance Premium Tax. It is time cash-strapped motorists got a break.”