Despite three consecutive years of decreasing premiums, car insurance costs have been increasing during the past six months.
Although rates are still lower than in 2013, Confused and the AA’s quarterly data shows that there has recently been an increase. Compared to the first half of 2014, there was an increase in cost of 2.4 per cent according to Confused and 1.4 per cent according to AA.
However, over the entirety of 2014, the prices of car insurance actually fell by 4.4 per cent according to figures released by the British Insurance Brokers’ Association (BIBA). Confused and AA agreed with BIBA when comparing the average price paid at the start of 2013 to the price paid at the end of 2014. Confused recorded a change from £736 to £594, whilst the AA British Insurance Premium Index recorded a change from £660 to £540.
A possible reason for the recent increase, according to some insurers, is that there has been a rise in fraudulent personal injury claims made lately. Strong competition between insurance companies had resulted in costs falling back in 2012, a time when the average cost was £724.