Households face two increases in auto insurance costs over the next six months as more motorists return to the road.
“I see premium increases in the next few months if we get out of this embargo. Therefore, there is potential for consumers to increase mileage and this is a huge risk factor,” said Ryan Fulthorpe of price comparison site GoCompare.
“Of course, the longer you sit in the car, the more likely you are to have an accident. And if you’re not in the car, you’re not causing an accident. “
According to comparison site Comparethemarket.com, auto insurance prices have fallen by an average of £74 this year compared to last year due to the decline in auto insurance. “The more cars back on the road, the more insurance costs can go up,” said Dan Hutson of Comparethemarket.
New regulations for the insured in the new year will likely be responsible for the second price increase.
Starting January, the Financial Conduct Authority will prohibit existing customers from charging higher premiums when renewing their insurance than they would charge for a new contract – known as the “loyalty penalty”.
The end of this practice is likely to increase policy prices everywhere, according to industry commentators, because insurance companies can’t charge that much when hosts renew their policies.