Car insurance warning as inflation and supply chain issues cause premiums to rise
A motoring expert has shared some of the reasons why the cost of car insurance is rising, with drivers typically paying over £450 per quarter.
The road accident compensation company Claims.co.uk has shared a number of reasons why the cost of car insurance has increased in recent months.
According to GoCompare, drivers paid an average of £465 per quarter for car insurance during the final three months of 2024, with prices significantly higher for motorists living in certain areas.
A spokesperson for Claims.co.uk noted that the rise in prices has not been helped by the recession, however suggesting that drivers can save money with a few small tweaks.
They explained: "In the final quarter of 2023, the UK entered a recession that has affected all areas of life for people throughout the nation, including increasing the cost of car insurance premiums.
"By following these expert tips, drivers may be able to reduce the price of their insurance premiums. It may also be worth changing suppliers mid-contract; there may be a mid-term cancellation fee, but many companies offer refunds for any cover that hasn't been used. However, it's important to remember that this can forfeit any no-claims discounts for the rest of the year."
According to Claims.co.uk, inflation is the most significant reason behind the recent rise in car insurance premiums.
The company highlighted that, whilst inflation rates are currently slowing down, claims made by drivers often take several months to settle, meaning insurance companies need to be careful that they will have enough to repair vehicles.
Similarly, rising inflation rates have caused the cost of labour to rise, making it more expensive to repair vehicles that have been involved in an accident.
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Claims.co.uk also noted that supply chain issues have also played a significant factor in the reason behind the increase in car insurance.
Whilst many of the delays were initially caused due to the Covid pandemic of 2020, global conflicts have prolonged issues, with 77 percent of mid-sized businesses affected during 2023.
The motoring industry has also been affected by the supply chain, with spare parts for cars taking longer to deliver and being more expensive to buy.
However, whilst car insurance premiums have increased due to a number of factors, there are still ways in which drivers can save money.
Claims.co.uk noted that motorists can get a discount on their next premium by proving that they are a safe driver, such as by fitting a low-cost steering wheel lock or dashcam.
Drivers with multiple cars at their property should also consider getting a multi-car policy, with insurers typically offering lower prices if two or more vehicles are insured together.