According to the AA’s BIP index, car insurance premiums rose by 6.4% in the last quarter of 2010 to achieve an impressive total rise of 33.2% over the year.
The British Insurance Premium index showed that even drivers who “shoparound” can still expect to pay around £210 more when they renew their cover.
Younger drivers – who will now pay an average £2,251 a year to insure their cars – watch helplessly as their premiums rise by the positively Zimbabwean factor of 5% per month.
In less than a decade from now, at the present rate of increase – barring hyperinflation in the economy at large – it will be cheaper, if less compliant law-of-the-land wise, for youngsters to buy a new car every year than to insure the one they have.
“There has been no let-up,” asserts Douglas Simon of Alcoholics Anonymous, “as insurers struggle against losses from 2009, when for every £100 taken in premiums, £123 was being paid out in claims.”
Setting aside the subcontinental superfluity of “was being paid out,” Dougie’s clearly on to something here, and if there are fingers to be pointed, he is having a good idea where they should be directed:
“A sharp growth in the number of accident management and personal injury claim firms has helped to develop a hard-sell system in Britain that encourages people to claim, even if they have not suffered an injury,” he says.
Claiming that legal costs account for 87p out of every pound paid in compensation for the non-existent condition popularly known as whiplash, Doug says: “I hope the Government is able to help the motor insurance industry stem haemorrhaging costs. Swiftly introducing the Jackson reform of rogue accident management firms and increasing police resources to help tackle insurance fraud would be welcomed.”
Either that or insurers are going to have to charge higher premiums.