Millions of UK drivers are facing a financial blow as the cost of petrol and motor insurance surges, according to the Association of British Insurers (ABI). The second quarter of 2023 saw drivers paying an average of £511 for private comprehensive motor insurance, marking a 21 percent increase from the previous year. In addition, the average price of a litre of petrol has risen to 157p as of October 1, a significant 9.6 percent increase since June.
The surge in car insurance prices has caused financial hardship for many motorists. Research conducted by Forbes Advisor reveals that the average driver has witnessed a £98 increase in their car insurance premiums over the past 12 months. However, the situation is even worse for younger drivers aged between 18 and 34, who have experienced an average price hike of £132 within just a year. Insurers attribute these price increases to rising costs on their end, with car repairs becoming more expensive and time-consuming due to a shortage of trained staff and supply chain bottlenecks.
Kevin Pratt, a car insurance expert for Forbes Advisor, advises drivers to be proactive in finding better insurance deals. He emphasizes the importance of shopping around early, as insurers tend to charge more as the renewal date approaches. Pratt suggests that receiving a renewal notice from one’s current insurer serves as a signal to begin searching for alternative options before automatically renewing the policy.
Simultaneously, fuel prices have also experienced an upward trajectory due to tightened supply from the Middle East. The damaged gas pipelines in Northern Europe and the conflict in Israel are expected to further push prices upwards. Moreover, a potential jump in services inflation may impact September inflation rates.
Ian Stewart, chief economist at accountancy firm Deloitte, acknowledges the slow progress in reducing inflation. As underlying inflation and service price pressures persist, Stewart expects interest rates to remain close to current levels for a significant portion of the next year.
The combination of rising motor insurance and fuel costs places a significant burden on UK drivers. As prices continue to surge, it becomes essential for individuals to be proactive in seeking competitive insurance rates and exploring alternative fuel options to mitigate the financial impact.
More detail via Birmingham Mail here… ( Image via Birmingham Mail )