The Office of Fair Trading (OFT) is going to start looking into the excessive increases in car insurance premiums. This is due to the 9 % increase in insurance coverage costs within the first 9 months of this year (2011).

Back in 2010, there was a noticed increase of 12 % throughout the whole year which has already rendered car insurance policy holders strapped for cash. Car insurance providers have stated that the main reason why premiums have risen in the said year is due to the increase in personal injury claims. It is these personal injury costs that have been driving motorists to darker roads.

The investigation of the Office of Fair Trading will focus on third party claims which include car repairs, parts replacement, provisions for alternative transportation yet do not include injuries.

Liberal democrat MP, David Ward, has initiated a campaign that will focus on high car insurance costs and their disadvantages to policy holders. With the investigation of the OFT finally commenced, he promised that a House of Commons Transportation committee will soon follow.

There were more than one thousand respondents who took part in the recent survey initiated by MP David Ward. It was through this survey that annual car insurance premiums were compared. Through this survey, it was disclosed that an average of 63 % was increased on their car insurance premium.

Having seen this staggering percentage in increases MP David Ward decided to commence an online petition which will hopefully urge the Parliament to make an action in creating more affordable car insurance rates. Also, a call for stricter penalties involving uninsured drivers is also prioritized.

InBradford, the premiums are excessively high because this is one of the hotspots for bogus accidents. Due to this, insurance experts fear thatYorkshiremight become a place full of uninsured drivers. In between the months of April and June alone of this year, there has been an increase of 3 % in premiums.

The MP forBradfordhas expressed his delight in the OFT and their commitment to help solve this social issue. As he has mentioned, “This here is a difficult situation and every factor needs to be taken into consideration. If not, it might be possible thatYorkshirewill never see cheaper car insurance rates. In relation to this, the Office of Fair Trading needs to make sure that this kind of behavior is permanently removed. This is to ensure that motorists will be able to get a fair price for their car insurance coverage.”

In the third quarter of this year, car insurance premiums may have lowered slightly but they still remain at a soaring high amount. AA Car Insurance Company has mentioned that their research shows that the average amount for an annual comprehensive car insurance policy has fallen by £ 2 – £ 921. This slight decrease occurred in the third quarter of this year. British motorists have staggered by the amazingly high cost of insurance for the past two years. In addition to this, increasing costs for auto repair have resulted in another reason for car insurance companies to demand more money from motorists. Within the period of one year starting from the first quarter of 2010 to first quarter of this year, car insurance premiums have shown an increase of up to 40 %. However, this particular increase has shown a slight decline. A decrease in car insurance premiums have been stated to be at 16 % and this has given British motorists some hope that perhaps the worst increases are now at an end.

“Within the past two years, insurers have seen the biggest and highest increases in car insurance premiums while these certain motorists have been struggling to diminish the broad gap between claims and premium income,” said the director of AA Car Insurance Company, Simon Douglas.

He also added that, “Although these sky-high costs have reached a historical high, in 2009 each £100 received in the form of a premium, £ 123 was being paid out in claims and other coverage’s. Something really had to change.”

“Now, however, the broad gap has sufficiently diminished and it has allowed insurers to start becoming more competitive in their pricing and marketing”.

On another note, Simon Douglas has also seen the possibility of the respite being short-lived. This is mainly due to the fact that there are still some inflationary pressures evident in the insurance industry.

“I believe that the evident decreases are just a breather rather than the beginnings of a trend. Car insurance premiums are most likely to backslide next year, yet they might not prove to be as worse as the previous increases.”

Certain statistics and figures have been gathered from the motor association and car insurers and it has been found that the average cost for building car insurance have risen by approximately 14 % in the last year. This would mean that car insurance has been increasing by around £ 150 per year. Also, the cost for a content cover is also up. An average price increase for this particular cover had risen by almost £ 80 or 6 % during the last 12 months.