Car insurance premiums soar

Increasing car insurance claims could drive more motorists to consider long term car hire.

MPs from a Transport Select Committee have heard that the rising number of motorists claiming on their insurance for whiplash following an accident has seen premiums in some areas rise four times more than the rate of inflation, guardian.co.uk reports.

Research by price comparison site confused.com found that on average, insurance policies in the UK are 4.9 per cent more expensive than this time last year. In the North the figure is even higher, with Bradford reporting rises of as much as 17.1 per cent.

In light of the increases, average insurance policies in the UK stand at £844, with the figure for those aged between 17 and 20 soaring to £2,590.

The number of whiplash claims has also risen, with the total reaching 570,000 a year, an increase of a third.

Speaking of the case to whatcar.com, chair of the Transport Committee Louise Ellman explained: "The financial threshold for receiving compensation in whiplash cases should be raised and, if the number of claims does not fall significantly, the Government should bring forward legislation to require objective evidence - both of a whiplash injury and of it having a significant effect on the claimant's life - before compensation is paid."

Amongst the other suggestions for bringing down premiums include preventing insurers passing on information of those who've had a crash to third parties as this too can increase premiums.