Mashing on the motorway meant much higher prices for motorists in the UK last year. Research released today from
But the price pain for policyholders didn't end there. Third-party, fire and theft (TPFT) customers fared even worse, as their annual increase in price skyrocketed 56.3%, which is the equivalent of an extra 322 pounds.
"Whilst costs are undeniably still rising, there is evidence that the rises are starting to lose momentum," says Will Thomas, head of motoring at Confused.com. "Despite the hefty annual increases, price rises declined for the second quarter running. Comprehensive policies rose by an average of 6.9% between October and December with TPFT ones increasing by 9.2%."
"Insurers have been carefully managing a juggling act between the need to address underlying profitability and maintaining competitive prices which explains the trends we have seen particularly in the second half of the year," adds EMB partner, Peter Lee.
Despite it being the subject of a Parliamentary Transport Select Committee, the last two quarters have not been the hardest on the 17 to 20 year old age group. In fact it's 51 to 55 year olds who have been hit with the biggest rise during the year, Confused.com says.
The rises in the older age bracket, who have already been affected by wider budgetary changes, will hit this group hard. Parents adding children to their car insurance policies as named drivers account for the bulk of the increase that this group has seen. The immediate issue seems to be insurance providers getting increasingly wise to the issue of fronting, which the practice of making an experienced driver the policyholder even though they are not the main user of the car in order to obtain cheap car insurance. Men adding a child to their policy saw rises 11% above the average.
"The investigation into insurance costs for young drivers is a clear sign that escalating costs and their implications are being taken seriously, but it seems there is no light at the end of the tunnel just yet," Thomas says. "The rise in Insurance Premium Tax and rising fuel costs will continue to challenge people financially."
