Car Insurance premiums have increased by a massive 40% in the last year, as huge levels of personal injury claims and fraud have ensured premiums have kept on rising.
A comprehensive car insurance policy will now cost an average of £892 at the end of March according it research, 40.1% higher than the same time last year and the AA say it is the biggest increase they have ever seen.
Young drivers continue to see the worst of the increases with an average fully comprehensive policy for someone aged between 17 and 22 jumping 64% to £2,431, and an even higher £3,052 if you only count men.
Premiums for young drivers who take third party, fire and theft insurance as a way of reducing costs also soared 82.1% to an average £1,533, although this rise was blamed on many insurers exiting this market in favour of comprehensive cover only.
The AA put the rise down to expensive personal injury claims, and high levels of fraud, despite the number of collisions in the UK dropping every year.
The number of whiplash injuries, often from up to three years ago had hit 200 claims a day, and many of those drivers had never mentioned any pain or injury at the time of the accident.
Simon Douglas from the firm said, “The record rises in fuel costs coupled with spiralling car insurance premiums is disappointing news and is making driving unaffordable for many, especially cash-strapped young drivers.”
He added that despite price increases of 5.9% during the first three months of the year, he expected these increases to slow, and didn’t expect the annual increase to top 20%.