Car Insurance prices could hit record highs by end of 2020 as average costs go above £800
The increase meant car insurance prices have seen their highest rise since 2017 according to analysis from insurance comparison site Confused.com and insurance broker Willis Towers Watson. Car insurance prices have now hit an average of £815 for comprehensive cover.
- Car insurance prices increased for motorists in this age range
The analysis has revealed female road users between the ages of 26 and 30 saw the highest average increase with a nine percent rise.
Male drivers aged between 17 and 20 saw their average costs increase by a further six percent despite already paying the highest costs.
Average prices saw the highest increase in Central London whose residents were forced to pay a massive eight percent rise in 2019 to pay average costs of £1,260.
Motorists in Greater Manchester pay an average of £1,053 for car insurance cover with road users in Oldham paying over ten percent more in 2019 to hit an average of £1,217.
The Scottish Borders saw the smallest increase in premium prices with a minimal one percent increase.
However, the South West was the cheapest region in the UK for car insurance costs with an average price of £595 for comprehensive cover.
The rise in costs have been blamed on high costs and the threat of increased tariffs on imports and exports post-Brexit.
Graham Wright, spokesperson for Willis Towers Watson said the data was the fifth quarter of uncertain pricing as costs continue to swing.
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He added: “Many of the challenges observed throughout 2019 will persist in 2020, as cost pressures remain from expensive vehicle repairs, theft claims, last summer’s discount rate change, Brexit-related uncertainty and IPT (Insurance Premium Tax) increases.”
Average prices in the fourth quarter increased to over £800 in costs over £40 higher than both the previous quarter and prices recorded twelve months ago.
Quarter four costs stood at £815 which is up on the £783 average in the third quarter and the £774 average costs over the same period in 2018.
Steve Fletcher, head of data services at Confused.com admitted the price rises were the biggest annual increases in car insurance premiums in two years.
- Car Insurance costs are higher for these particular careers
He added: “The past 18 months have been very volatile, with prices fluctuating before delivering a powerful blow to end the year. And this is a pattern we have seen before, which resulted in premiums increasing a further £100, on average.”
“If we see a repeat of this cycle, then we can anticipate prices to exceed £900 in the next 18 months and reach the highest on record.
“With the current economic uncertainty surrounding the UK, we shouldn’t hope to see an easing of insurance premiums in 2020.”
The average of £815 is just £43 below the highest ever average car insurance prices recorded in 2011.
Further analysis from Confused.com revealed prices in Northern Ireland have also reached a two-year high as costs rose to almost £1,000 on average.
Price increases saw average costs soar to £976 on average as motorists were forced to pay an extra £45 on 2018 costs.
Motorists who have seen their prices increase are urged to re-evaluate their policies and look at switching providers.
Changing your insurance provider can see costs tumble as companies will give out their best policies to tempt new customers to join.
Louise O’Shea, CEO of Confused,com said: “It’s January, the month to save money and re-evaluate our spending. But the bad news is car insurance costs are increasing.
“And, as drivers, this is something we can’t avoid. If costs continue to accelerate at this pace, we could be paying record prices by the end of the year.
“Shopping around is key to saving on car insurance. And even if your renewal price is cheaper, or the same, it’s likely there will be another insurer out there willing to offer a better price.”
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