Average cost of cover now stands at £562, compared to £474 in 2015 – a rise of 19%
Premiums are falling for young drivers, but still £760 higher than national average
East London drivers face biggest bills
Drivers urged to shop around to secure savings of up to £2781
External factors such as the rise in insurance premium tax (IPT) and changes to the Ogden discount rate have had a huge impact on car premiums, with MoneySuperMarket today revealing the cost of cover has risen by 19 per cent in the last two years, and by 10 per cent in the last 12 months.
Drivers with five or more years’ no-claims discount paid just £347 on average between April and June, whereas those without a no-claims bonus faced costs of £1,271 on average. Men paid £85 more than female drivers for their car insurance; on average the cost of cover was £600 for men from April-June, while women paid 14 per cent less (£515).
Typically, younger less experienced drivers face higher premiums. While the cost of cover for 17-19 year olds is more expensive than any other age group, premiums fell by £13 on average from last year (£1,334 compared to £1,322 in 2017). However, younger drivers are still paying £760 more than the national average.
Regional trends
Drivers in East London face the highest premiums, at £1,166 on average, followed by West Central London (£1,027), North West London (£1,003) and Ilford and Barking (£979). Outside of the capital, the highest premiums are in Manchester (£859), Oldham (£847) and Bradford (£841).
Those on the Isle of Lewis (HS) in Scotland’s Outer Hebrides are currently enjoying the cheapest premiums (£302), followed by Kirkwall in the Orkney Islands (£318), the Shetland Islands (£318), Inverness (£329) and Perth (£336).
Kevin Pratt, consumer affairs expert at MoneySuperMarket, said: “These are grim times for motorists as far as their insurance is concerned. IPT rose again in June and now stands at a hefty 12 per cent of premiums. And the change to the Ogden discount rate for personal injury claims earlier this year has added to the inflationary pressure.
“It is to be hoped the Chancellor resists the temptation to push IPT higher in the autumn, but nobody would be surprised if he did. We should also look for quick and meaningful reform to the way the Ogden rate is calculated so that a fairer outcome is achieved for personal injury victims and insurance buyers. Likewise, we need to see the government come good on its promise to overhaul the way the courts deal with fraudulent whiplash claims – and it needs to keep its foot on the neck of insurance companies so that any savings that accrue are passed on to policyholders.
“Anyone renewing their policy in the next few weeks should be aware of how premiums have risen over the last few years, and should shop around to see what else is available. It only takes 10 minutes and you could save more than £275.”
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