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Car insurance premiums show record rise

Despite the fact that the UK is suffering from a full-blown recession with money tighter than ever before, it seems as though UK car insurance companies are pushing premiums higher and higher. A report by the AA confirms that UK car insurance premiums rose by 3.5% over the last three months and a massive 11% over last year. When you consider that inflation has fallen towards zero over the last few months it is difficult to understand why charges are going up.

However, a further look at the figures suggests that an increase in theft, fraud, personal injury claims and legal expenses are having a greater and greater effect on the industry. The cumulative impact of legal expenses is set to hit just under £11 billion by 2012, a figure which will have to be met by UK car owners.

It is also interesting to see that the cost of whiplash injuries alone in UK represents a massive £66 on each and every car insurance policy sold. With the average comprehensive car insurance policy now around £778 and third party fire and theft insurance now just under £1000, keeping your car on the road has never been more expensive. Is it really a surprise that more and more people are going without car insurance?

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