A 40 per cent increase over the last two years has seen the cost of car insurance rise to the highest record level.
Over the last 12 months, the average cost of the cheapest fully comprehensive insurance policies has risen from £577 to £690. Across the market as a whole, the average price for cover has risen by nearly £200, from £981 to £1,152.
At the start of 2010, there was a difference of £215 between the average cost of cover and the cheapest comprehensive cover, but this has since risen to a difference of £464.
Price increases have affected the whole of the market, but the extent of these rises vary drastically by location, gender and age group.
In Northern Ireland, the cost of the cheapest possible policies increased by 2.5 per cent since the start of 2017, while in London there was an increase of 7 per cent. Anglia has been hit hardest by the price rises, with policies rising by 11 per cent.
In terms of disparity between the age groups, 50 to 59-year olds have experienced the least drastic rise of 6.2 per cent across the period. Comparatively, those aged between 17 and 22 have seen the most dramatic price jump, with the cost of cover rising by 10.6 per cent over the same time span.
There is a clear difference in price rises between genders too, particularly in the 40-49-year-old age bracket. Over the course of 2017, men have experienced a 6.6 per cent rise in premiums, while women have been hit with a 9.6 per cent rise.
The dramatic rise in prices has been blamed on a multitude of factors, including Insurance Premium Tax (IPT), which has more than doubled since 2011, and a change in the formula used to calculate compensation for those who suffer serious injuries.
Michael Lloyd, the AA’s insurance director, said: “We are in a sharply upward cycle and premiums will continue to rise until competitive pressure once again forces a downward spiral – but that is some way off.
“I fear that the Chancellor may once again target IPT in the autumn Budget as a quick win to fill in some of the Government’s financial potholes.”