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Record rise in motor insurance costs; EU may make matters worse
Date 13/10/2010 13:40  Author webmaster  Hits 956  Language Global
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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