Motor insurance premiums have risen by an average of £110 within the last year, according to recent industry research. In fact, the average comprehensive policy premium of £781 could pass £1,000 by 2018.
These changes stem from an adjustment to the Ogden rate, the upcoming rise to the Insurance Premium Tax from 10 to 12 per cent and more expensive technology in vehicles.
For the last 16 years, the Ogden rate, the rate used to calculate personal injury claim payouts, has been set at 2.5 per cent. Now, after a ruling by the Minister of Justice, the Ogden rate has been reduced to -0.75 per cent, resulting in more money for injury victims, but a higher bill for insurers.
Due to this ruling, experts estimate that drivers under the age of 22 may pay up to £1,000 more on their policies.
Despite the recent spike in premium costs, there are several ways you can keep your motor rates low:
- Enquire about a telematics policy. In this policy, the insurer installs a system in your vehicle that monitors your driving and then rewards you for driving safely.
- Secure your car with an alarm, immobiliser or tracking device. This discount can lower your premiums by as much as 5 per cent.
- Drive fewer miles. Cutting 10,000 miles a year can save you £100, on average, in premium costs.
- Talk to Bond Lovis Insurance Brokers before purchasing a vehicle. Certain vehicles, such as sports cars, carry higher premiums.
Bond Lovis Insurance Brokers is devoted to keeping your rates low and your cover robust. Call us today to learn about the best motor insurance solutions for your vehicle.