13 OCT 2010
By Ian Cowie | Telegraph Blogs
Motorists’ insurance costs increased by an average of 40 per cent last year, or more than 10 times the Consumer Prices Index (CPI) measure of inflation and the biggest annual rise since the AA began collecting national figures in 1994.
Other major motor insurers, including Aviva and RSA, say the sector is facing a ‘perfect storm’ of rising personal injury claims, legal fees and fraud. But independent experts at the British Insurance Brokers Association (BIBA) say companies are repricing cover in an attempt make profits after many years of losses – especially insurers owned by banks which nearly went bust during the credit crisis – and intervention by the European Union may force premiums even higher.
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