Cost of car insurance climbs 12 per cent during 2016

The cost of insuring a car has gone up by almost £100 on average over the course of 2016.

New analysis that looked at 873,000 customer quotes generated through MoneySuperMarket in November found that annual car insurance premiums averaged at £597, 12 per cent more than they were at th…

The cost of insuring a car has gone up by almost £100 on average over the course of 2016.

New analysis that looked at 873,000 customer quotes generated through MoneySuperMarket in November found that annual car insurance premiums averaged at £597, 12 per cent more than they were at the start of 2016.

Premiums have steadily climbed each calendar month, but the last few months have seen some sharp rises.

In August, the average premium was £525, rising to £549 in September, £572 in October and £597 in November.

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Car insurance is only going to get more expensive in 2017 too, with Insurance Premium Tax set to rise from ten per cent to 12 per cent in June.

This move, announced in November’s Autumn Statement, will add £51 to the average household’s insurance bill, and marks the third time this tax has been increased in 18 months.

The cost of motoring could increase even further, with petrol prices set to rise again, heading towards £1.20 a litre – a far cry from the sub-£1 prices advertised on some forecourts at the start of 2016.

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Kevin Pratt, consumer affairs expert at MoneySuperMarket, said: “It’s important for every motorist approaching renewal to run a quote to find the best price for their next year’s policy.

“Simply rolling the policy over with the same insurer – what’s known as ‘auto-renewal’ – means you’re almost certainly paying more than you need to.”

Separate research from October found that 51 per cent of motorists could save up to £284.50 by shopping around for the best car insurance premium.

By Amy White

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