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Car insurance premium rise for 2010

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There’s another blow in store for car drivers this year in 2010 as insurance premiums are set to rise for the second year in a row. Last year, unknown to most drivers, insurance premiums rose by 10% and this year insurance is set to rise by 13% making the average quote £500 or an increase of £50 on policies taken out this year.

Who is to blame for car insurance rise?
Due to high costs of running a car along with the obligation to purchase car insurance, many people choose not to pay insurance. If you are caught driving with no insurance, you could be fined upto £5000 and that’s the risk many are willing to take. There has also been an influx of ‘no win, no fee’ lawyers popping up and advertising everywhere, so with the loopholes even uninsured drivers can walk away with compensation. Unfortunately for the majority of law abiding citizens, they will have to stump up the difference. Last year for each pound a policy was worth, the insurance companies had to pay £1.20 making a substantial loss.

Strangely enough, insurance companies claim that they are forced to put up their prices because of rival insurance companies following suit. If they didn’t increase their prices, they would have too many customers to deal with and wouldn’t be able to cope. This seems to be a very strange reason for a large corporation that needs customers to be in business and making them look elsewhere is just ridiculous.

This year’s car insurance premiums rise will affect mostly newly qualified drivers as they will be forced to pay up to £300 more this year than last year. A female driver whose son had recently passed asked her insurers to put her son on as a named driver. She usually pays £130 for fully comprehensive insurance but by adding her 17 year old son on her car insurance, she has been forced to pay £2,300 and that’s a whopping difference of £2,170. The insurance company has assured her that it will reduce by 40% the year after if her son does not have an accident and does not make any claims.

Unfortunately there isn’t much we can do to beat the rising costs of insurance premiums other than being careful. There are a few things you can do to keep the quote as low as possiblem though and they are listed below:

  • Drive less walk more
  • If your annual mileage is less than the national average make sure you tell the insurer
  • Don’t modify the car as this will increase premiums
  • New drivers taking a pass plus course will benefit greatly by getting cheaper quotes
  • If possible, car share is a good way of going to work

The most important of all is to shop around don’t feel obliged to stick to the same insurer no matter how great they are. By switching you may get a better deal and incentives such as reduced home insurance and so on.

gices Published 15 Mar 2010
I'm a Software Developer and the founder of Clever Dodo. I encourage people to practice MAM (Movement/Arts/Meditation) for a well-balanced and happy life. Born in Mauritius and now living in the UK, I usually blog about fitness, music, spirituality and driving topics to pass on my knowledge.

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Driver SOS (UK)

Helping with car insurance, driving bans, learning to drive and other motoring issues

Driver SOS (UK)

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2898 members . 1217 topics . 2221 posts
BenBridgeman 10 Dec 2010

Your statement about modified cars is not true. I work for a broker insurance company and very often a modified car can bring the premiums down as there are specialist insurance companies out there that say, "people who mod their cars care about their cars and are more likely to be more carefull"