The average motor insurance policy now costs £845, a figure that is up £215 on this time last year.
The AA reports that the 34% rise, the biggest proportional increase in 17 years, has mainly been driven by personal injury claims. The Daily Telegraph says the number of claims for whiplash has gone up 25% over the past six years, even though the number of reported injuries of that type has fallen. It adds that the number of firms offering no-win, no-fee claim services has doubled in the past year.
Fraud is also a big issue, with an estimated 30,000 fake crashes staged last year. That's led to estimates that the average driver pays an extra £44 on their policy to cover such claims. Of course, that's inherently an estimate as insurers only pay out for fake crashes that they aren't aware are bogus.
Another £30 of the average premium goes towards covering the costs of crashes caused by uninsured drivers. The figure has prompted calls for tougher penalties on uninsured drivers, who in some cases are better off being caught and fined than if they had paid their premiums.
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