The average motor insurance policy cost an extra £40 in 2017, a rise of 9% and a record high, according to the Association of British Insurers (ABI).
Q4 2017’s average price paid for private comprehensive motor insurance was £493. The ABI’s Premium Tracker showed that this was the highest quarterly figure since ABI started collecting the data in 2012, up 6% on the same quarter in 2016.
The average premium paid over the whole of 2017 at £481 was 9% higher than the previous year, and the highest since ABI started collecting this data back in 2012. This added an extra £40 to the average premium.
The average cost of motor cover has leapt by 29% since 2014.
Reforms to how compensation for large personal injury compensation awards is adjusted and how lower value whiplash-style claims are handled, as well as a freeze on the rate of insurance premium tax, are all required to help reduce the cost of motor insurance, according to the ABI.
Rob Cummings, the ABI’s assistant director and head of motor and liability, said: “The rising cost of motor insurance shows no sign of abating. Changes to how compensation pay-outs are calculated, insurance premium tax, more whiplash-style claims and rising repair bills are all piling on the pressure for cash-strapped drivers.”
“The government must urgently bring forward relief for motorists by introducing its reforms to create a fairer compensation system, and tackling low value whiplash style claims without delay, as well as freezing Insurance Premium Tax. It is time cash-strapped motorists got a break.”