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Car insurance premiums increased by £110 in 2016

  • Publish Date: Posted about 7 years ago

Car insurance premiums rose by an average of £110 in 2016.

More expensive repairs and recent government changes to injury payouts added an extra 16% to insurance costs. It has been reported that drivers paid on average £781 on comparison sites for a comprehensive policy in the year to March 2017.

Average premiums are set to rise again and could exceed £1,000 next year. Newer vehicles have witnessed the biggest increases as their increasingly complex electronics cost more to repair.

Insurers have also raised prices in response to a new formula for calculating compensation payments, according to data from comparison websites. The government altered the Ogden Rate for calculating lump sum payments to accident victims who suffer long-term injuries.

Car insurers have warned that policy costs will "soar" to offset the higher payouts.