Car Insurance Costs Could Be Increasing Again
Motorists are quite likely to be faced with higher motor insurance prices following increases to insurers’ costs. Car insurance comparison site Tiger.co.uk investigates further.
The way in which motorists are compensated for road accidents in the UK could be the cause of further increases in the cost of motor insurance. Insurers are set to raise prices by up to 15% this year – and could impose a similar increase again next year according to some sources.
Over the past two years UK courts have been increasingly awarded annual payouts to drivers who have suffered serious injuries such as paralysis from road accidents. These regular payments have apparently been adopted because recipients of lump sum payouts have struggled to pay for care when the money has run out.
However, annual instalments can also increase with inflation or if the victims condition deteriorates, which has created greater uncertainty for the insurers responsible for handling the payouts.
A spokesperson from Willis Re said, "Many reinsurers have become increasingly concerned about taking all of these variables on to their own balance sheets."
The rises will no doubt cause a double blow to young female drivers who have only recently seen the price of their premiums jump considerably due to European gender equality rules that were introduced on December 21st.
Andrew Goulborn, Commercial Director at Tiger.co.uk commented, “Additional increases in the cost of motor insurance will not be welcome news particularly for young women drivers. We would always recommend that drivers shop around for their car insurance using a comparison site like Tiger.co.uk to compare prices from as many insurers as possible before committing to purchase.