Car insurance – From TODAY you’ll be paying more, here’s why
CAR insurance premiums could rise by up to £75 from March 20th due to a new Government ruling.
All drivers in the UK are set to be stung by up to a £75 charge today due to a new Government rules.
Young drivers are set to feel the brunt of the new charges with insurance premiums rising by as much as £1,000.
Justice secretary Liz Truss announced that the new charge is being introduced to compensate for an increase to insurance payouts for those with long-term injuries.
The Ministry of Justice has lowered the discount rate used to calculate lump sum payouts in severe damages claims from 2.5% to minus 0.75%.
This is used to calculate how much compensation is fair to offer someone with a permanent injury.
This results in higher costs for the insurer and bigger pay-out for the victims, but also UK motorists will also face paying an extra charge.
Over 36 million British motorists are set to be affected by the new ruling, which the Association of British Insurers describes as ‘crazy.’
The new ruling could increase costs for insurers by up to £3.billion warned Consumer Intelligence.
Tips for cheap car insurance
Don’t just automatically renew your policy – Settling for the same premium you had last year could cost you around £286 extra annually.
Be honest about your occupation – The wording of your job title can affect how much you pay.
Martin Lewis reveals ways to save on car insurance
Describing yourself as a chef instead of just kitchen staff, your average insurance quote could be up to £98 higher, revealed GoCompare.
Shop around – Use comparison websites to see what policy options are available. However some insurers don’t use these sites to advertise, so be wary of that.
Do it early – Switching your policy up to three weeks before the renewal date could save you around £280 found Compare the Market.