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Why is car insurance rising so fast? Mine just rocketed 118% in the space of one year

When I first passed my driving test at the tender age of 17, I can remember almost falling off my chair at the insurance quotes I received.

We’re talking four figures for paltry old third party, fire and theft’only. Ludicrous. Especially as I was driving a battered old Volvo 343 – a less desirable motor it would be hard to find.

Car insurance quotes are rocketing...for young and old alike
Car insurance quotes are rocketing...for young and old alike

Granted, for all they knew, I drove like a young lunatic. The good news was that my Volvo struggled up a hill. Speeding was, to be frank, not something it was capable of. I was a horribly boring/sensible young driver (delete as applicable).

But, I comforted myself, when I got older, that the cost would come tumbling down as long as I didn’t regularly take out fellow motorists with some misjudged manoeuvres. And, for all but a clumsy slow-motion bit of reversing into someone in a supermarket car park many years ago, I achieved that.

That initial pain was brought back to me by reading an article a (young) colleague wrote this week highlighting the financial costs involved to actually learn, pass, buy and insure a car in this day and age. I have complete sympathy.

But, young folk, rest assured, us oldies are still getting clobbered too.

Now in my fifties, I was somewhat taken aback when my insurance provider sent me my latest quote. In the space of a year, it had shot up from £265 to £578.

Having a prang is a pain all round – the costs involved astronomical
Having a prang is a pain all round – the costs involved astronomical

That is, wait for it, a 118% increase in the space of 12 months. Ouch.

I knew quotes were sky-rocketing but that was, I felt, a trifle ridiculous.

So off I trotted to a friendly online price comparison site and the best I could still get was £420. Still a nigh-on 60% price hike. Still ruddy painful to my can-only-afford-to-pay-monthly-thus-paying-even-more-than-that-through-interest bank balance.

But here’s the interesting part.

In March of this year, as I was driving into the Dartford Tunnel, the traffic suddenly slowed and so did I. However, as I Iooked in my rear-view mirror it was quite clear the car behind me wasn’t going to make it in time.

The scene of the author’s prang...and a costly one at that
The scene of the author’s prang...and a costly one at that

For what seemed like an eternity but was actually only seconds, I braced and sure enough it kindly slammed into the back of me. My car had its exhaust knocked off and a bit of a dent in the back. But, sounding like someone who’s just been in a fight, you should have seen the other guy.

They had a jumbo dent in their bonnet. Fortunately, pride was the only personal injury on the day.

We exchanged details – much to the chagrin of the motorists stuck behind us - and as the damage to my car didn’t look too horrific, I asked if they wanted me to get a quote in case it would be better to avoid having to go through our insurance companies. From past experience I knew that even being in a crash in which I was completely the innocent party, my bill would still go up as a result (“because,” I was once told on the phone, “you’re now the sort of person who is involved in crashes”. True, but a little unjust I thought. I’m also the sort of person who just happened to be in a queue of traffic when someone behind me wasn’t paying attention).

So, when I eventually got home, I popped down to my local independent garage and got a quote on the repair. About £370 they said. However, presumably, as their car had come off worse, the driver that hit me wanted to go the insurance route.

To cut a very long, very boring story short, I was quickly informed I was not at fault and the entire bill would be picked up by their insurance company. My precious no-claims bonus unaffected. Despite not really needing one, I was told to take the offer of a hire car as mine was shipped off to Dover (I live in Thanet) and the (minor) repairs conducted.

The scene of the author’s prang...and a costly one at that
The scene of the author’s prang...and a costly one at that

The hire car was, I must admit, rather swanky (comfortably nicer, newer and bigger than mine – not particularly difficult to achieve) and I spent the week petrified of damaging it.

The final bill their insurance company coughed up? £975. That’s £600 more than it could have cost. Now, granted, that could include the repair to the other car too, but given my hire car alone must have cost a minimum of £200 for the week I had it and assuming the repair they did was similar in cost to the quote I received, that leaves a mere £175 for the other car… and I’m not including the costs involved in shipping my (perfectly drivable) car half-way across the county for the repair to be carried out. All of which seems a bit of a stretch of the imagination.

The extra, hidden, cost of that crash I was an innocent driver in? An extra £40 on my premium. The sort of ‘penalty’ I bristle at.

All of which makes me less surprised when I see the frankly exorbitant insurance quote I’ve just received.

Yes, the claim was handled swiftly and effectively, but I did become acutely aware of the ‘industry’ behind each claim.

Cut that back, I’d argue, and we could get those prices back down to what, in this cost-of-living crisis era, we could all stomach.

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