October 14, 2008

Car Insurance costs continue to rise

According to the AA’s British Insurance Premium Index the average cost of car insurance has now risen to nearly £725. This has come as unwelcome news for many UK drivers whose finances are already under considerable pressure from steep increases in food and fuel bills.

Motor insurers have stated that there has been a significant rise in the number of road accident personal injury claims and this has contributed to soaring insurance costs. Market specialists Datamonitor stated that they expect UK motoring claims to rise to around £10.9 billion by 2012.

A spokesperson for AA Insurance commented that young male drivers who do not have much experience are chiefly responsible for insurance losses. The average cost of an insurance claim for male drivers in this age bracket is £4,500 but claims from women of the same age are likely to be around £2,700. This is the main reason  why young male motorists can expect to be faced with insurance premiums that are twice as high as those for young female drivers.

The AA index , which was established in 1994, will normally monitor around 1000 car insurance premiums across the UK. The average is then calculated to produce a benchmark index figure.

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