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Daily Insurance Industry News
Wednesday 13th of December 2017
July 4, 2007

AA Index Shows Motor Insurance Hike

by Gill Montia

Story link: AA Index Shows Motor Insurance Hike

AA Index Shows Motor Insurance Hike

According to the AA’s British Insurance Premium Index, car insurance premiums increased to their highest level ever over the three months to July.

The average premium quoted for annual comprehensive motor insurance rose 2.5%, to over £822, a figure over double that quoted in 1994, when the Index was first established.
In the case of third party fire and theft cover, the average premium quoted exceeded £1,000.

The increases have largely been attributed to costs incurred by the industry because of accidents involving uninsured drivers and a rise in repair costs, particularly for new cars.

In the case of uninsured drivers, claims have to be settled by the Motor Insurers’ Bureau, which is funded by the insurance industry and ultimately the insured motorist, who is estimated to contribute £30 a year.

In addition, claims for injuries and uninsured losses have been steadily increasing, largely as a result of the growth in the number of legal firms specialising in compensation claims.

However, Insurancewide.com, the price comparison website, has pointed out that the AA’s Index does not include premiums quoted by direct insurers and that taking direct insurers into account, average premiums decreased 4.6% in the second quarter of 2007.

 

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