Average car insurance premium nears £1,000

Average car insurance premium nears £1,000

Car insurance premiums increased in 2011, despite a fall in the third quarter of the year, the AA reports.

Based on its ‘Shoparound’ price index, which takes the average of the three cheapest quotes from several insurance providers, the AA says that premiums have increased by 15.3% compared with a year ago.

The average comprehensive cover has increased by 5.4 per cent to £971.40, compared with £921.38 in October 2011.

However in Scotland the shop around premium for comprehensive cover is £587, making it the cheapest place in Britain for car insurance.

In contrast, the average premium in north-west England is £1,615, which is even more expensive than London where the average premium is £1,120.

Young drivers are worst affected by the price increase and some insurers have stopped insuring drivers under the age of 21 altogether.

Premiums for young male drivers under the age of 22 increased by 15 per cent to £3,163 in 2011, compared with 2010.

Earlier this month the AA welcomed a report by the House of Commons Transport Committee into the rising cost car insurance.

The report suggested that car insurance premiums are being driven up by the compensation culture in which the number of personal injury claims has soared.

MPs are calling for motorists to have to face medical tests to prove that an accident has caused whiplash injuries.

Simon Douglas, director of AA Insurances said: “A claims culture has developed to the extent that it has become accepted that if another vehicle hits your car, you should make an injury claim.

“That’s regardless of how serious the injury is, or even if no injury has actually been suffered.

“The Transport Committee has clearly recognised that this has driven up premiums for everyone.”

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