Due to a steep rise in heavy snowfall-related insurance claims, car insurance groups are set to rise their rates.
One motor car insurance provider saw its normal claims figures double over the course of a week. Axa Insurance stated that 50 per cent of one week’s high volume of insurance claims were related to damage caused by snow and ice. In comparison to the previous week, the number of claims the insurer received was up by 23 per cent. The number of accidents involving a single vehicle increased by 85 per cent, according to Axa.
Fellow motor insurer AA also saw their claims rate rise by 23 per cent. AA Insurance spokesman Ian Crowder commented that last year’s severe winter saw the insurance industry paying out on many more claims than the winter previous. If the trend continues this winter the results could be car insurance rate hikes as high as 10 per cent to offset costs, he added.
Financial comparison website Moneysupermarket.com’s Clare Francis also commented by stating that motor insurance costs have already been on the rise.
Ms Francis remarked that with insurers paying out on more claims the price of insurance will be impacted by the current bad weather. However next year’s prices are influenced by not just winter weather costs but many different factors, she added.
Unfotunately many other factors in conjunction with higher winter accident rates are working to push rates ever higher, she said. Ms Francis predicted that the longer the bad road conditions persist, the higher impact they will have on the impending rate hikes.
Another insurance industry expert made the observation that due to the rise in size and frequency of personal injury claims motor insurance costs were already rising. He also stated that other insurance markets – such as the home insurance industry – could start feeling the effects soon as well.