Car insurance premiums rose again in February

Drivers are facing increased motoring costs in 2022 as data shows car insurance went up £76 in February, compared with last year.

It means that the average insurance premium is now £689, up from £613 in February 2021.

The data from insurance comparison site Comparethemarket.com shows that the cheapest premium has also gone up, increasing £51 to £570 in the same period.

It follows a similar trend from January, where the average premium increased £64 year-on-year to £700, with Comparethemarket. com blaming changes in Financial Conduct Authority (FCA) rules that were introduced at the start of the year.

The increases follow a period of low prices towards the end of 2021, where the average premium in the fourth quarter of the year was at its lowest point since 2014, believed to be because insurance companies were hoping to attract new customers before the reforms were introduced.

The FCA introduced new rules to prevent insurers offering discounts exclusively to new customers. They are designed to stop existing customers being penalised for loyalty, but there were warnings it could drive up prices as insurers look to make up the difference.

Speaking after February’s insurance data was revealed, Alex Hasty, director at Comparethemarket.com, said: “Motorists will be concerned that the cost of car insurance has jumped from last year.

“This increase will put yet more financial pressure on many households whose budgets are being squeezed by the cost of living crisis with rising inflation, surging energy costs, and higher petrol prices.

“For any drivers who are worried about this upswing in car insurance prices, we recommend shopping around for a cheaper deal ahead of your renewal. Motorists could typically save more than £100 by switching to one of the cheapest insurance providers, which could offset the increase in premium costs or be put towards fun things like a cinema trip and a meal out with friends and family.”