Eco car insurance is a niche market that is growing, according to an expert.

Duncan Bowker from Co-operative Insurance, which launched the first eco insurance policy in July 2006, said that once people realised that it did not cost more to go green, they were sold on the idea.

Hybrid car sales in Europe increased by 25 per cent during the first six months of 2007 on the same period last year, according to figures published by Green Car Site.

Some 15 per cent of new registrations were low emission cars.

"The take-up has been very positive and the pleasing thing for us is that the take-up has been across the various demographics," Mr Bowker said.

"It's not been just one age-group that's been switched on to green insurance, from younger motorists right through to older motorists."

He added that people are looking for different ways to go green and that financial services products are a good way to do it.

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