Motorists issued dire warning as premiums set to rise after drastic 40 per cent car insurance hike
Cars travel along the M25 near Heathrow airport, London.
PA
Motorists have been issued with a dire warning as premiums are set to rise after a drastic 40 per cent car insurance hike.
Inflationary pressures have been identified as the key reason for the price increase, with spare parts and labour costs soaring.
Average annual car insurance premiums surged to £743 in June.
The figure is up £208 with the same month in 2022.
Vehicles travelling along the M4 motorway
PA
Drivers under the age of 24 have witnessed a drastic 45 per cent hike in the past 12 months.
Compare the Market revealed young drivers pay £1,640 for an average annual policy.
Anna McEntee, director of insurance at Compare the Market, said: “Drivers will be concerned that the cost of car insurance is rapidly increasing.
“Some young drivers are facing particularly steep hikes of more than £500. It’s now more important than ever for people to shop around and compare prices to check you’re getting a good deal.”
An Admiral sign in Wales
Creative Commons Licences/Geograph
There are also growing concerns motorists have not yet seen the end of car insurance hikes.
Car insurer Admiral is expected to increase its rate.
The Cardiff-based company lost 380,000 customers but still managed to record a four per cent profit increase to almost £234million.
Milena Mondini de Focatiis, the chief executive of Admiral Group, conceded that the business had pushed through a “very big increase” in premiums already.
MoneySavingExpert Martin Lewis
PAShe added: “We expect to continue to increase prices.”
MoneySavingExpert Martin Lewis responded to further car insurance hikes by issuing a warning.
He said: “I’m hearing more and more ridiculous car insurance cost rises, be careful.
"Never accept these, ensure you don’t just renew, always combine comparison sites, check Direct Line too and find the cheapest, (or try MSE’s compare+ which does most of it)."