Car insurance rises while home premiums remain static
Published On 16 January 2007
Car insurance is reaching its highest level yet with no signs of abating while house insurance premiums are remaining static, according to a new survey. Figures from the latest AA British Insurance Premium Index, which tracks levels of home and motor insurance since 1994, have discovered the average premium for a full car insurance policy in the last quarter has jumped by 4.35 per cent to £806.
Third party fire and theft insurance – typically the preserve of younger drivers with little no-claims bonus - has risen again but on a more manageable scale to just under £1,000.
Despite these increases, consumers can take some heart from the static home insurance premiums. The average buildings insurance premium rose by just 1.26 per cent to £209 while the average contents insurance fell by 0.5 per cent to under £148.
Kevin Sinclair, AA Insurance spokesman, said: "Since then, competitive activity led to a falling trend despite the fast rising cost of both accident damage and personal injury claims.
"Other insurers are now following Norwich Union's lead and have increased premiums to more realistic levels given that the cost of claims is rising about six per cent per annum – and this is reflected in the index.
"As more people will inevitably be shopping around they need to make sure they're aware of what insurers are offering for their money. In this environment, competitive home and car insurance premiums may come at the expense of benefits or high excesses. Making a claim is the wrong time to find that your cover doesn’t meet expectation."
