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Car insurance hit by personal injury awards
27 August 2008
Car insurance premiums have increased in price due to the rising cost of claims, according to the Association of British Insurers (ABI).
Research by Sainsbury's bank revealed that between July 2007 and June 2008, the average car insurance premium has increased by 5.8 per cent which is due to a significant increase in the cost of personal injury awards, claims ABI.
Malcolm Tarling, spokesperson for the ABI, said: "The fact is the main driver for motor insurance premiums in recent years has been the increase in the cost of personal injury awards."
Mr Tarling states that another major reason for the rising cost of car insurance premiums is the number of uninsured motorists on the road.
"The police are detecting more uninsured drivers than ever before, but nevertheless they are costing around £500 million a year," he added.
The AA British Insurance Premium Index found that young drivers are hardest hit by rising car insurance because they are the most likely to make a claim.
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