Car insurance premiums rise for first time in nearly three years


Traffic JamCar insurance premiums have risen for the first time in nearly three years according to new statistics revealed today.

The AA’s table of cheapest deals on the market showed the cost of annual comprehensive car insurance rose by 5.2% in the three months to the end of June.

Young drivers are facing the biggest increase with those aged 23 to 29 seeing a 6.2% rise over the same period, the biggest increase of any age group.

A driver in this age group will typically pay a premium of £683.

AA Insurance managing director Janet Connor said: “Insurers have been releasing their reserves to maintain their competitive edge to the point where this is no longer sustainable – and we are seeing premiums beginning to rise once more.

“The days of cheap car insurance premiums are over – price rises are inevitable.”

The BBC reports that a quote for a typical comprehensive motor insurance policy for all age groups has risen to £549.

The AA estimates that the rise in insurance premium tax, announced by Chancellor George Osborne in the Budget, will add £18 to the cost of the average comprehensive car insurance policy.

A 1.3% rise in the index of cheapest home and contents insurance premiums, the first increase since 2012, was also reported by the insurer.

The average premium for a contents policy has hit £61.18 with the typical buildings premium up to £108.15.

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