Let’s be honest, you probably saw this coming – car insurance premiums are on the rise, according to the latest Association of British Insurers (ABI) Quarterly Motor Insurance Premium Tracker. However, what’s always interesting is to compare how its figures relate to those of the AA British Insurance Premium Index, released just days ago.
According to the AA’s statistics, which we reported on
here, the average cost of a quoted premium has climbed by £82 over the last 12 months – with the average comprehensive car insurance policy now standing at £585.84. This means a 16.3% rise year on year.
By comparison, the ABI’s figures, released today, show that the average premium has climbed by 9% over the last year – adding an extra £38 to the average comprehensive car insurance policy. The average cost, according to the ABI’s figures, now sits at £440. Of note is that the ABI surveys “what consumers actually pay for their cover”, whereas the AA figures are based on “shop around” data.
Some of the key statistics revealed in the report are:
- The average price paid for comprehensive insurance was £440, up 1% on the second quarter of the year.
- Compared to the same period last year the average premium paid has risen by 9% from £402, adding an extra £38 to the average price paid for comprehensive cover.
In addition, the ABI pinpointed a number of factors that it believes are to blame for the surge in premiums. In particular it points to a 5% increase in the average bodily injury claim settlement so far this year – now standing at £10,955; vehicle repair costs climbing 25% over the last three years to an average of £1,655; and a two-thirds leap in the rate of Insurance Premium Tax in less than a year.
“Insurers are fighting the corner of hard-pressed motorists, despite facing a triple whammy of rising costs from personal injury claims, repair bills and Insurance Premium Tax,” said Rob Cummings, ABI’s head of motor and liability.
“The Government has a key role to play in ensuring the best insurance deals for honest motorists. They need to urgently consult on the planned reforms to address the compensation culture, which honest motorists have been waiting nearly a year for them to introduce, and avoid any further hikes in Insurance Premium Tax.”
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