Motor insurance premiums hit record high

Motor insurance has jumped by £30 in the last year to hit a record average high of £493, say insurers.

That figure was the average paid in the fourth quarter of 2017 for a private comprehensive policy and is a 6% rise on the same period a year earlier.

The Association of British Insurers (ABI) released the data and said the overall average for the whole of 2017 was £481.

That represents a £40 or 9% increase on 2016.

The average motor insurance policy has jumped 29% since 2014, the ABI added.

It is calling for insurance premium tax – which the Government has put up several times in recent years – to be frozen to help drivers lower their motoring costs.

The standard rate is now 12% – double what it was between 2011 and the end of 2015.

Whiplash claims and changes to lump-sum compensation payments for people with long-term injuries are also blamed for the increase.

Rob Cummings, the ABI’s head of motor and liability, said: “The rising cost of motor insurance shows no sign of abating.

“Changes to how compensation payouts are calculated, insurance premium tax, more whiplash-style claims and rising repair bills are all piling on the pressure for cash-strapped drivers.”

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While the average is now £493, there are large regional differences.

Research last year unsuprisingly named London as the most expensive, with average premiums of £1,000, while the cheapest areas were Scotland and southwest England..