Cheap car insurance provider, Tiger.co.uk, recently announced the results of its monthly price monitoring report indicating that while 2011’s first quarter was 31.3 per cent higher than last year’s, those renewing their policies could look forward to car insurance rates that have held steady at December 2010 prices. The figures indicate that there was only a 3.1 per cent inflation rate to policy prices throughout the past six months.
One website spokesperson stated that while stability appears to be returning to the market, those who renew their policies earlier in 2011 as opposed to later could still experience price inflation in the double digits. This is due to increases that were implemented last year through September of 2010, the spokesperson said.
These premium hikes can be attributed to insurers attempting to return to profitability in the wake of years of sector losses. The reduction in profits was caused by poor performance in investment income earned by car insurance companies, increases in the number of personal injury claims and fraudulent claims, and also rising costs from untraceable or uninsured motorists causing accidents.
Overall inflation levels are thought to be likely to be consistently less in 2011 than they were last year. Despite this prediction, the online insurance specialists forecast premiums will increase by approximately 20 per cent. The largest hike is likely to occur in the third quarter, they stated.
However some motorists will experience higher price inflation than others. Those drivers aged 17 to 22 are predicted to experience rate hikes as much as 50 per cent or more.