Hard market begining to return for motor and home insurance
Insurers are making large increases in motor and home insurance premiums as they fight back against pressure from the recession.
The latest AA Insurance British Insurance Premium Index revealed
Average quoted car insurance premiums have risen 5.6% over the past quarter (14% over the year), the fastest quarterly jump since the AA started the Index in July 1994 – the second record rise in succession
Third Party premiums rose by 9.3% over the same quarter (17.6% over the year), partly because fewer insurers are offering this type of cover
Fraud, personal injury claims, uninsured drivers and car thefts are all contributing to the increased premiums, while insurers continue to pay out more in claims than they receive in premiums
Home buildings insurance continues to rise – 1.6% over the quarter (9.8% over the year)
Home contents premium fall has ended – and bounced over the past quarter by 1.8% (but nevertheless has fallen slightly over the year)
An AA spokesman said: “Rises in buildings reflects claims and industry concern about changing weather patterns and rising frequency of damaging storms; rise in contents premiums is fuelled by rising recession-related claims.”
