Car Insurance prices rising faster than ever
It’s been revealed that car insurance prices are rising five times faster than inflation.
Over the past 12 months, car insurance has grown by 14.6 per cent, five times more than inflation at 2.9 per cent, forcing the average cost of an annual policy up to £755 across the whole of Great Britain.
The only positive is the fact that the rate at which car insurance is increasing has slowed over the last three months.
Why is car insurance going up?
The cost of car insurance always seems to be going up however over the past 12 months the rate has dramatically increased.
According to Consumer Intelligence, the reasons for that rapid rise are tax rises, the weakness of the pound and rising claim costs.
What’s perhaps more surprising than an increase in the cost of car insurance is the drivers who are being hardest hit.
Over 50s suffer most
For over 50s, the average car insurance premium has jumped up by 16.5 per cent, almost two per cent more than the overall UK average.
But why are over 50s being hit hardest? According to John Blevins, Consumer Intelligence pricing expert, it’s because they are driving for longer and as a result ‘becoming involved in more accidents.’
However age and experience do deliver discounts, with an average car insurance policy of £434 for over 50s – much lower than any other age group.
For under 25s the 11 per cent increase hasn’t been quite as dramatic thanks to an increase in telematics (black box technology) usage.
Despite a relatively low rise, premiums for under 25s are still the highest of any age group in the UK with the average car insurance policy sitting at £1,719.
Where are car insurance premiums at their highest?
It won’t come as much of a surprise to hear that car insurance prices are higher in London than anywhere else at £1,048.
Insurance costs have also grown faster than the UK average in the capital over the past 12 months, at a rate of 15.7 per cent, but that’s nowhere near the biggest increase.
The North East is the area that’s been hit the hardest, with premiums growing by 17.1 per cent over the last year, while prices in Wales, Scotland and the South West have also increased more than London.
However, the average premium in those five areas remains well below that of London, with Scotland still the cheapest area to insure your car with average premiums of just £518.
Do you pay more for your car insurance than you should?
As well as revealing national averages for car insurance premiums, Consumer Intelligence has also broken down the stats based on area.
You can view the average cost of car insurance in your area using the table below and see how you compare to your region’s average.