Car Insurance prices set for increase

Many experts within the financial sector predict that car insurance premiums are likely to increase by around 20%. This is due to various factors such as the increasing amount of people claiming on insurance, the amount of uninsured drivers and people lying about their details in order to receive a lower price on their car insurance.

The amount of people claiming on their insurance has rocketed, the Association of British Insurers estimate that for every £1 they collect from various premiums, they have to pay out £1.15 in compensation; this has resulted in many providers going bankrupt. This means car insurance companies are unable to offer the kind of deals that flooded the market in the past.

The number of uninsured drivers has also played a part in the price increase, according to a recent survey, around 1 in 20 drivers are uninsured and this has a detrimental effect on all providers as it takes longer to claim when the driver is uninsured. As car insurance quotes have risen more people are looking for ways around paying too much, the most common lies told are about their age, address and where the car is kept at night.

Although there are still the means to find cheap car insurance , insurers are finding it increasingly hard to offer cheap deals. One reason is the sophistication of new cars, this has had an effect on the way the insurers repair cars because although it may seem to be a small bang, the problem could be bigger than it seems. All these reasons mentioned above coupled with the amount of competition for peoples money, insurers now find it harder to put together a competitive deal making it all the more important to shop around.