Injury Claims Cause Car Insurance Premiums to Soar

Injury Claims Cause Car Insurance Premiums to Soar

Statistics from the Department of Transport have provided welcome news to motorists with road casualties down by eight per cent compared to the previous 12 months.

Yet despite this, the AA British Insurance Premium Index reports that there has been a 3.5 per cent rise in the average cost of a comprehensive car insurance premium during the April-June 2009 quarter. This is the fastest rate rise for nearly a decade.

Why premiums are rising

Despite the encouraging figures and the falling accident rates on the UK’s roads, the number of personal injury claims received by insurers has continued to soar.

According to the Association of British Insurers (ABI) there has been a steady, and often unnecessary, increase in the number of claims, which topped £9.6billion last year – up from £8.8billion in 2006. Its statistics show that there were 1,200 whiplash claims per day last year – costing £1.9billion in personal injury payouts.

It seems that drivers are more inclined to make personal injury claims primarily due to the ongoing recession. With fuel prices rising, and more people out of work, traffic volumes actually fell by two per cent last year. Yet those that are involved in accidents are more likely to make a claim even for relatively minor injuries such as whiplash that could be cleared within a few days.

How to stop your premiums soaring

Ironically it is unnecessary claims that could have a direct impact on a motorist’s car insurance premiums. Most insurers offer no-claims discounts which get higher the longer you go without making a claim – so making an unnecessary claim could wipe out this discount.

Safe drivers are rewarded by insurers – most offer cheaper premiums to those who stay accident and conviction free. Further savings can be made by enhancing the security of your vehicle; driving a car with a smaller engine; agreeing to a mileage limit; and increasing your voluntary excess.

Motorists are also advised to shop around for cheap car insurance every year rather than accepting a renewal quote from an existing provider. Most car insurance companies hike their prices every year while offering discounts to new customers – so it makes sense to capitalise on these deals.