Figures from the Confused.com Car Insurance Price Index, produced in association with Towers Watson, show that in the last three months of 2014 the cost of a typical annual comprehensive motor policy rose to £594 – an increase of 2% or £12.
Back-to-back rises
This is the first time since 2011 that prices have risen in two consecutive quarters, the study found.
Falls in prices in early 2014, however, mean that current premiums remain lower than in 2013.
Steve Sanders, finance director at Confused.com, said: "These latest price increases, for the second successive quarter, are likely to fuel speculation that the motor insurance market has turned and price rises will become a regular occurrence."
The research showed that out of 121 postal towns in the UK, 96 experienced some sort of price increase between October and the end of the year.
Rises for young and old
The youngest drivers faced the greatest increase in costs in absolute terms: average premiums for 17-year-olds were up £73 to an eye-watering £1,983 a year, a rise of 3.8%.
But the highest percentage increase, 4.7%, hit drivers aged 61 – this group’s typical annual car insurance bill rose £15 from £327 to £342.
The City of London was the area which experienced the greatest price rises: by the end of 2014, premiums were up 3.3% to £1,012, an increase of £33 on 12 months previously.
In parts of the Midlands, rises were higher than average: in Telford, for example, premiums were up 6.5% or £33 to £549 over the quarter.
Price falls in some areas
Elsewhere, it was a different
Premiums have remained largely unchanged across much of Manchester and Merseyside, while in west central London the average price was down to £888 – a fall of 0.3% over the quarter, but more than 17% lower than at the end of 2013.
Drivers across Shetland and the Hebrides have benefited from large quarterly falls in the cost of cover: price falls of 8.1% and 10.1% respectively means motorists in these islands now pay £451 and £438 for annual insurance.
Sanders added: "While some consumers may still be experiencing year-on-year savings on their car insurance policies, they should prepare themselves for further price increases over the coming months.
"Any savings they do see compared to last year will be eroded by further price increases.
"With that in mind, we would urge consumers to shop around and compare prices to ensure they get the best deal possible."
source material: confused.com
