Costly premiums blamed for rise in uninsured crashes

THE soaring cost of car insurance is leading to more victims of uninsured drivers for the first time in more than a decade, figures show.

The Motor Insurers’ Bureau (MIB), the body that compensates victims of uninsured drivers, said the number of accident claims it received had risen by almost 10 per cent to around 12,000 a year. This is despite the number having previously been in steady decline since 2004.

According to the MIB there are more than a million uninsured drivers on Britain’s roads. It puts the increase in claims down to the rising cost of motor insurance premiums, which reached a record high this year.

The average price paid for comprehensive car cover is now £462 a year, industry figures show.

Young drivers have been hit the hardest, figures from the Association of British Insurers (ABI) show, as the average cost of car insurance for a driver aged 18-20 is now £973.

For years the industry has blamed rising insurance bills on whiplash claims, tax rises and reckless young drivers. Uninsured drivers are also said to raise bills for other motorists as the MIB is funded by premiums from those who do insure.

But last month an investigation by this newspaper revealed that every driver in Britain is being overcharged for motor cover because insurers are using secret deals to grossly inflate repair bills. Insurers are routinely inflating repair costs by as much as 100 per cent, while receiving undisclosed kickbacks for the difference, potentially adding five per cent on to the insurance bill of every motorist in the UK.

Ashton West, the MIB’S chief executive, told the BBC: “In the last year or so, for the first time in a decade or more, we are starting to see the trend of reduction actually change direction, and we have started to see it increase. It’s early days, it’s difficult to know exactly why, but we’ve seen insurance premiums rise in recent times and it’s possible there is a link between the cost of insurance and people’s propensity to drive without insurance.”

According to MIB data, 145,000 uninsured cars were taken off the road in 2016, a rise on the year before.

The number of claims from victims of uninsured or hit-and-run drivers had fallen from around 25,000 in 2004 to just under 11,000 last year, before the 2016/17 rise.

This year, the MIB expects to pay out £256million from money provided by insurers.

Huw Evans, the ABI director general, said: “With inflation on the rise, motor premiums at a record high and the public purse under pressure, it’s concerning that the Government has yet to commit to delivering a fairer system for setting the personal injury discount rate.”