Anyone who drives a car even for recreation has noticed that motoring has become more and more expensive lately. However the rising cost of petrol isn’t the only problem – when it comes time for your motor car insurance renewal the typical driver will see a 34 per cent increase in their premium to a new yearly average of £845.
Young motorists are in for even more of a shock. The average car insurance rate for the younger driver rose by 58 per cent to a flabbergasting £2,251 on a typical quote in the past 12 months.
MPs have stepped up their attacks on insurers for the swift rise in insurance costs. Many of these policymakers have stated that insurance companies have been encouraging car accident-related injury claims, resulting in ballooning premiums.
The MPs published a recent report that called for greater transparency regarding referral payment activity by insurers. Insurance firms reportedly forward personal details to vehicle repairers and car hire companies in the wake of accidents and receive a referral fee for the activity.
Insurers are also allegedly selling phone numbers and addresses to law firms specialising in personal injury cases. MPs claim that this behaviour has led to a steep rise in the number of car accident claims over the last few years, as the number of reported accidents is much less than the number of claims.
Honest motorists have paid the price for the insurance industry’s actions. On a £450 a year typical insurance policy, approximately £220 of the premium goes directly to pay for the costs of accident claims, tax, legal fees, and fraud incidences.