The rising cost of motoring revealed

Whilst motoring is considered a luxury by some, it is an essential method of getting around for a large portion of the population.

Many of us rely on cars and other vehicles to get from A to B, but increasing car insurance costs are making this more difficult than ever before.

Car Insurance

Car insurance costs are increasing for a number of reasons. One being that the compensation culture has continued to grow despite efforts to clamp down on false and faulty claims.

The governmentís recent motor insurance summit highlighted plans to tackle the ëcompensation cultureí. This includes plans for whiplash victims to be reviewed by an independent panel of doctors.

Figures from the Association of British Insurers (ABI) found that whiplash claims are pushing up the cost of the average motor insurance policy by a massive 20%.

Whilst there has been a fall in the number of car crashes, whiplash claims have increased by a third in the last three years. The ABI reports that 570,000 people claim for whiplash injures every year, which costs the car insurance industry over £2 billion. This filters down to the consumer, who has to pay an extra £90 a year on top of the average motor premium of £440.

James Dalton, ABIís Head of Motor and Liability said: ìIf whiplash was an Olympic sport, the UK would be gold medallists. The fact that whiplash is virtually impossible to disprove means that for too many it has become the fraud of choice, often aided and abetted by ambulance-chasing lawyers and claims management firms.î

He continued to suggest that there should be a cap or reduced levels of damages for whiplash claims. One extreme claim was that greater use of biomechanical evidence should be used to enable a speed threshold to see when whiplash would occur.

ìOnly by thinking big and bold can we reduce the whiplash problem and the costs of motor insurance.î

Itís not just whiplash claims which are pushing up the cost of insurance though.

The latest figures show that insurance for young drivers aged between 17 and 20 can be more than 18% of their average annual wage. One price comparison website found that the average young driver was paying £2,499 for their annual comprehensive car insurance policy, which is a staggering 18% of their average salary, effectively pricing younger drivers out of the market.

Not only are young drivers struggling to keep up with the high costs of motoring, but women will also face motoring misery in the next coming months.

From 21st December 2012, gender will no longer be used as a calculation towards insurance premiums. This means that female drivers could see their motor insurance dramatically increase, while some male drivers will see their premiums drop.

Women typically have lower premiums than men, however, this will soon change as insurers are more likely to raise womenís rates than reduce male ones to match them. In addition to this, men are unlikely to see a significant drop in premiums as they might need to absorb the cost of the change.

Compare car insurance with Money Expert.

Breakdown

Breaking down could be an incredibly expensive process for motorists who do not have any roadside assistance cover. Call out charges alone can run up into hundreds of pounds on top of the cost of the actual part, which needs fixing. Re-fitting just one tyre by the road could cost around £150.

It could well be worth investing in Breakdown Cover to avoid extortionate fees and provide you with peace of mind.

Compare Breakdown Cover with Money Expert.

Warranty

Car warranties will typically cover the cost of repairs should anything go wrong with your car. However, once this period is finished it could potentially cost motorists a significant amount.

Prices vary significantly and it could be worth shopping around for the best deal. Compare warranties with Money Expert.

New figures show that one in five cars fail their first MOT, with French car manufacturers being the worst culprits. The research from an independent consumer motoring website, honestjohn.co.uk, reviewed over 24.5 million MOT records to reveal that Japanese vehicles have the best pass rate compared to French and American cars.

One way to avoid paying the high fees of MOT repair could involve purchasing a classic car. Mike Penning, Minister for Transport, recently announced that vehicles that were manufactured before 1960 will be exempt from MOT tests from 18th November 2012. This is being done in an effort to reduce motoring costs. Unfortunately, this move will only benefit the 0.6% of classic car owners with cars registered before 1960.
 
“We are committed to cutting out red tape which costs motorists money without providing significant overall benefits. Owners of classic cars and motorbikes tend to be enthusiasts who maintain their vehicles well – they don’t need to be told to look after them, they’re out there in all weathers checking the condition of the engine, tyres and bodywork,î said Penning.

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