The cost of car insurance in Manchester and Merseyside has accelerated by £67 (6%) in the past three months, as premiums look on track to be the most expensive on record in the next year.
Motorists in the region are now paying £1,101 for their car insurance, according to the latest Confused.com car insurance price index . And the data, which forms the most comprehensive car insurance price index in the UK based on more than 6 million quotes a quarter, reveals prices are £155 (16%) higher than they were this time last year.
The sharp increases this quarter can largely be attributed to extra pressures recently imposed upon the industry, including the Ogden rate cut, which sees insurers potentially paying out more for personal injury claims, and an increase in Insurance Premium Tax (IPT) in June.
And it seems these pressures have had an impact on drivers across the country, with the average UK-wide premium now costing £847 – which is just £11 short of the highest recorded price. This staggering figure is down to a recent 8% increase in the last quarter – the biggest quarterly increase in seven years – equivalent to a hike of £66 from £781 at the start of the year.
This staggering figure is down to a recent 8% increase in the last quarter – the biggest quarterly increase in seven years – equivalent to a hike of £66 from £781 at the start of the year. The rate of the increase can largely be attributed to extra pressures recently imposed upon the industry, including the Ogden rate cut, which sees insurers potentially paying out more for personal injury claims, and an increase in Insurance Premium Tax (IPT) in June.
These pressures have also caused the cost of car insurance to rev up 18% annually, equivalent to a whopping £132 price rise since this time last year, which is the biggest annual monetary increase seen over a six year period . And, as car insurance costs shift up a gear, it seems likely drivers will see the average premium pass the £1,000 mark by 2018.
However, it appears the latest car insurance price increases are leaving both male and female motorists in the UK feeling the wrath of sharp quarterly increases, of +9% (£77) and +7% (£53) respectively. Men have now broken the £900 barrier (£901) and are just £7 off paying their highest ever premiums (£908, Q2 2011). While women are paying £781 on average and just £14 less than the most expensive car insurance they have ever paid (£795, Q2 2011).
It also seems that certain demographics have whizzed past the threshold when it comes to sky-high car insurance costs. Those aged between 25 – 42 years old and 54 – 70 years old are paying more than they have ever paid for their premiums. And while younger drivers still have some way to go before they hit the peak, those aged between 17 and 27 years old are now paying over £1,000 for their car insurance, on average.
In fact, younger motorists are bearing the brunt of the price increases. While 18 year olds are still paying the highest premiums of any other age group (£2,334), it’s 19 year olds who will notice the biggest jump with their costs having soared by a staggering £202 (10%) this quarter alone. And 21 year olds have experienced the biggest monetary increase annually, with their car insurance ramping up by an eye-watering £315 (22%) since last year.
However it’s not all bad news, with some respite this quarter for those hitting retirement age, with 66 year olds enjoying some of the lowest premiums of any age group (£467) and also experiencing the smallest quarterly increase of just 4% (£20). This is in comparison to many 65 year olds, who have just stepped off the career wagon, and who saw the biggest quarterly percentage increase of any age (14%, £65).
Looking to the regions, while there is some disparity, no area of the UK seems to have escaped unscathed from car insurance price rises this quarter. In fact, 11 regions – including the East of England, South of England and West of England – are all paying the highest premiums they have ever paid. Car insurance for motorists in Northern Ireland has broken the £1,000 barrier for the first time ever, with their premiums now higher than Outer London and the West Midlands.
And while some areas of Scotland are better off than the rest of the UK, the region has faced a raft of car insurance price rises. Drivers in the Borders of Scotland are still paying the lowest premium (£608) of any region, but only after surpassing the £600 mark and facing the highest annual increase (27%, £129).
Amanda Stretton, motoring editor at Confused.com, says: “Drivers in Manchester and Merseyside are really having to dig deep into their pockets to pay for their car insurance with the latest average premium now costing £1,101. Given the recent changes to the Ogden rate and the IPT increase, it is no wonder this price has reached this level, with motorists in Manchester and Merseyside now paying £159 less than the maximum average premium recorded for the region.