Car Insurance Inflation
Why are car insurance prices increasing so much at the moment?
There are a number of contributing factors that affect the cost of car insurance in the UK. Both inflation and fraud have had an impact on prices over the last 12 months but; the rising incidence and cost of personal injury claims that are related to road traffic accidents is one of the largest contributing factors. The increase in claims expenses has been instrumental in creating substantial underwriting losses that were predicted to rise to over £1 billion in 2010. Research has shown that this alone has added an extra £80 on to the cost of the average motor policy in the UK.
Estimates also suggest that one out of every 20 vehicles on the road in the UK is being driven by an uninsured or untraceable driver. Claims that involve these drivers cost insurers even more and are responsible for placing another £30 per annum on the average premium.
We are now tracking and publishing the price increases in the car insurance market in our monthly monitor Tiger Watch.