Car insurance costs record first spike since early 2017, according to the AA
- Car insurance premiums are back on the increase following a period of falls
- An annual comprehensive car insurance policy stood at £609.93 on average
- This is an increase of 2.7% over the quarter, but still down 5.9% over 12 months
Car insurance premiums are on the rise following a period of falls as repairs become more expensive, according to an index.
An annual comprehensive car insurance policy for an individual who shops around stood at £609.93 on average in the fourth quarter of 2018 – an increase of 2.7 per cent over the quarter, but still down 5.9 per cent over 12 months, said the AA.
Its latest report reveals the first increase in rates since the second quarter of 2017.
Car insurance premiums are on the rise following a period of falls as vehicle repairs become more expensive
“This is the first spike in car insurance premiums since the beginning of 2017,” said Janet Connor, the AA’s director of insurance.
Insurers are under pressure from increasing costs of crash repairs “thanks to the growing complexity of modern cars”, according to Connor.
“Underlying all of this of course are concerns surrounding Brexit”, she continued, “regardless of what the final deal looks like, the market has continued to battle with the value of sterling.”
She added: “This has led to the rising cost of imported car parts, further adding costs to the car repair industry which ultimately finds its way to the premiums we pay.” Connor said younger drivers now face paying premiums averaging £1,317.
“Young and newly qualified drivers face a significant penalty when it comes to insurance pricing, not least because they have not built up a no claim bonus. So it is no surprise that some take the risk of driving without insurance,” said Connor.