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Car Insurance Rises as Petrol Prices Plummet

Car Insurance Rises as Petrol Prices Plummet

Although it may sound ridiculous it seems that the decrease in fuel prices has had a bearing on the insurance industry, consequently seeing a rise in premium prices across the board. With lower petrol prices we saw more motorists taking advantage of this last year, spending more time on the road and encouraging traffic. This has unintentionally causeScreen Shot 2015-01-16 at 15.07.53d insurers to up their prices, protecting their own profit margins. Figures from the Department of Transport proved that towards the end of 2014 wan additional 525,000 were being added to UK roads, a 2% increase when compared to figures from the previous year. In the UK 2.48 million new cars were sold in 2014, the most in a calendar year since 2004. In total, drivers travelled 77.9 billion miles in the three months to the end of September 2014, a 2.2 per cent increase compared to the same time a year earlier. The insurance industry It is said that the average UK policy rose by £12, or 2 per cent in the last three months of last year, with the average policy coasting £594. This marked the first quarterly increase since 2011. Simon Peevers, of the RAC, said prices at some pumps were as low as £1.04 at the end of last week. Petrol in Birmingham now costs less than £1, according to reports. On Monday, Asda and Morrisons cut pump prices further, taking another 2p from the price of diesel and petrol. . Steve Sanders, finance director at, said insurance costs would keep rising. "These latest upwards price movements are likely to fuel further speculation that we have passed the bottom of the insurance price cycle," he said. Let us know what you think on this story, were the insurance industry right to increase prices? Leave your comments below.

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