CAR insurers are seeking to claw back the industry into profitability as motorists are hit with a 20 per cent spike in rates.
Comparison site Tiger.co.uk said that prices have risen by a fifth from last year for drivers facing a September renewal, and have increased by six per cent from just last month.
The spike has been anticipated for many months as the cost of claims has risen. This, coupled with fierce market competition, has created an unsustainable financial model for many insurers, a one-two which has seen the current hike.
Andrew Goulborn, Tiger.co.uk’s commercial director, said: “We’re seeing substantial increases in prices for most UK motorists with only the very youngest of our male driver profiles being relatively unaffected. And with the government’s 58 per cent increase in insurance premium tax - IPT goes up from 6 to 9.5 per cent this November - we’re likely to see continued inflation in car insurance prices across the rest of 2015. In the last three months we’ve seen rates climb by 7.3 per cent and the last quarter of 2015 could well see an overall increase of another 5-7 per cent. As ever, our advice to all drivers is to shop around at renewal to make sure that they are getting the very best prices without compromising on levels of cover”.