UK car insurance news

Royal Bank of Scotland announces increase in price of motor insurance quotes

UK drivers are facing a rise in motor insurance quotes as the influential car insurance company Royal Bank of Scotland (RBS) announces that it has been increasing its rates in recent weeks. It is thought that drivers will see further increases next year.

RBS, which is in charge of cheap car insurance providers Direct Line, Churchill and Privilege, has put up the cost of its motor insurance quotes after Norwich Union made a similar move in September 2006.

It is thought that these rises - and those predicted next year - are a response to the increased cost of personal injury claims made against insurance firms following car accidents.

Some cheap car insurance companies, such as Norwich Union, say that they have been paying out more in claims than they have been taking in motor insurance premiums for the last four years so it is time for prices to rise.

However, the Association of British Insurers (ABI) puts the increased motor insurance quotes down to two factors.

It commented: "The first is personal injury costs - a very large part of your premium covers personal injury - and secondly, there is a major problem around uninsured driving.

"There's around a million uninsured drivers on the road and all of us pay £30 on our premiums to cover those."

The Admiral Group, which controls online car insurance firm elephant.co.uk and women's car insurance provider Diamond, has not confirmed that it is increasing its LL27LL yet. However, it is expected to do so in the near future after its underwriting director was quoted as saying that it was looking to RBS to guide its pricing.

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