Car insurance up by a third in
2010
22 Jan 2011
by Hugh Bryant
The AA's Insurance Price Index has shown that car insurance
policies increased in price by a third in 2010. That's an extra
£210 onto the cost of the premium which rose to £843.
Drivers aged 17-22 saw a 58% increase, bringing their typical car
insurance premium to £2,251.
We have estimated that the cost of car insurance could continue to rise
by a further 20% in 2011. With rises in fuel costs, fuel duty and VAT
in 2011, drivers are being hit by ever-increasing motoring costs.
The government has recently spoken about introducing a fuel price
stabaliser whereby if fuel prices increase the duty would fall. Any
controls on ever-rising fuel prices are to be welcomed but, clearly,
there is little of any substance that the government can do as it needs
every penny of its income to rescue the country's economy.
As a result of these ever-rising costs, people are beginning to buy
smaller, more economic cars. This has been helped by manufacturers
extracting more power from smaller engines via technological
improvements, assisted by greater use of turbos.
The UK's dropping fuel sales are consistent with this trend and that
people are making more economic use of their cars, saving up trips to
do several tasks at once. In addition, the public are making greater
use of home delivery services.
Inevitably, people will be doing less recreational driving in order to
make their motoring budget go as far as possible.
Driving for the sheer pleasure of it is likely to be an activity that
has stopped for most people, for good.
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