Car insurance premiums accelerating.

Summary: New research has revealed that the cost of car insurance is rising at its fastest rate on record.

New research has revealed that the cost of car insurance is rising at its fastest rate on record.

Average premiums for comprehensive motor cover jumped by 5.6 per cent in the three months to the end of September, the biggest increase since the AA first started monitoring the market in 1994. The annual rate at which the cost of the cover is rising also hit a new high of 14 per cent.

Simon Douglas, director of AA Insurance, said: "Most drivers will be seeing sharp increases when they renew their annual insurance premiums.

"The index suggests that 89 per cent of insurers have increased their premiums by more than Au5 over the past quarter. Only 2.5 per cent reduced them," he added.

The group, which analyses quotes from 90 insurance companies and brokers for 1,000 customer profiles, found the average cost of comprehensive car insurance had risen from Au721 a year ago to Au821 now.

It warned that further increases were likely to be on the way, as car insurers were currently paying out an estimated Au110 in claims and costs for every Au100 they received in premiums.

Independent Television News Limited 2009. All rights reserved.

Independent Television News Limited 2009. All rights reserved.

Provided by Syndigate.info an Albawaba.com company