Motor insurance set to rocket in the UK

Motorists in the UK are set to face huge increases in motor insurance over the next year according to recent reports relating to some of the larger motor insurance companies in the UK. It has been reported that the biggest motor insurer in the UK could be whacking up the cost of premiums in 2007, increasing the gap even further between the prices from some major insurers and some of the cheaper motor insurance companies.

Unfortunately, the large rise in premiums could mean that those companies currently seen as budget insurance companies, which are able to offer huge discounts, could also be forced to push up premiums, making it even more costly to own and drive a car in the UK. Norwich Union has already raised premiums by up to forty percent over the past few months, and other major players are set to follow.

The largest motor vehicle insurer, the Royal Bank of Scotland, is now set to follow suit and push up its insurance premium rates, and smaller companies could follow. One spokesperson from the Admiral Group stated: ‘We believe Royal Bank of Scotland Insurance is the decisive factor in taking the market up in price. If it were to sustain a series of increases over the next 12 to 18 months, that would take rates up substantially.’

According to statistics forthcoming rises could push up an average insurance premium of around seven hundred and fifty pounds to around nine hundred pounds. Officials from the Royal Bank of Scotland Insurance stated that the rises were largely due to the heft cost of claims that had been made over recent years. An AA spokesperson also spoke about the rises, stating: ‘You will find people will shop around even more now. The market is going to be even more polarised between the highest and lowest prices.’

Tags: claims, costs, car, norwich union, premiums, accidents