Car insurance prices have rocketed over the last year, with average costs rising by 13%, according to new analysis.
The hike takes the average premium to about £683, says market research firm Consumer Intelligence.
It blames Insurance Premium Tax as part of the reason for the increase.
The tax, which is directed at insurers but largely passed on to consumers, rose from 6% to 9.5% in November last year and is set to rise by a further 0.5% from 1 October, as announced in this week’s Budget.
See the Insurance tax rise to fund flood defences news story.
For the over-50s, average premiums are up by 15.3% in the year to February, compared to 9.3% for the under-25s.
However, older drivers still pay considerably less than younger drivers, according to the research, with the average premium for over-50s at £298 compared to £1,600 for under-25s.
The research also highlights a shift in technology with ‘black box’ telematics policies, which price young drivers depending on how well they’re monitored to drive, offering 48% of the best deals for under-25s.
One of the best ways to cut insurance prices is to never auto-renew, always compare prices first – it could result in you saving hundreds.
You can compare car insurance prices via Moneywise.
Also read our cost cutting tips in Are you stuck in a car insurance loophole?