The average price of car insurance has been increasing in the UK due to consumers’ tendency to shop around for the cheapest deals, according to the latest index of motor insurer AA.
The index showed that the typical quote for someone shopping around for a comprehensive policy reached £568.48 in the second quarter, up by £12.56 from the first three months of the year, the Daily Mail
The average quote from April to June is also higher by £84 or 17.2% when compared to the prices in the same period in 2015.
"Increasing numbers of car owners shop around for their cover every year, especially at a time when premiums are going up,” AA insurance director Michael Lloyd was quoted as saying in the Daily Mail
According to the insurer, the rising numbers of car owners searching for the cheapest deal every year means that there is now less incentive for firms to offer introductory loss-making insurance prices to motorists.
The AA report said customers have become less likely to simply stick with their existing insurance provider when the introductory price ends.
"As more people look for introductory offers, there is less incentive for companies to offer loss-making prices to attract new business that will, a year later, go elsewhere. So I believe this is one driver of recent premium increases while insurers are looking for ways to better reward customer loyalty."
By regions, Northern Ireland saw the biggest rise in car insurance premiums over the last quarter as the average cover was pegged at £804, the Mirror
Meanwhile, the cheapest place to get car insurance is Scotland, where the average premium costs £404.
Brokers call for tax break as car premiums hit 6-year high
7 million UK drivers lie to get cheaper insurance: Survey
Car insurance premiums rise, seen to surpass record levels