Car Insurance Costs Are Being Driven Up

Car insurance premiums could soar by up to 20 percent this year, experts warn.

Companies blame the problem on the rising costs of fraud and personal injury claims.

Insurers pay about 105 pounds of costs and claim up to 100 pounds their contributions.

Up to now, the industries have recouped the shortfall by investing the premiums in the stock market.

But in the current volatile investment climate, but this is no longer viable.

AA Insurance said the average cost of the most competitive comprehensive motor insurance increased by 8.7 percent last year to 486.45 pounds.

Spokesman Ian Crowder added: "Some commentators point to an increase of 20 percent over the next few years. Certainly increase this volume will be needed if the industry in order to achieve a profit of commitments."

The figures show that the fraud costs increased by about 17 percent in the previous year.

But the bill was the largest claims for personal injury, which the top 22 percent.

Approximately 430,000 claims whiplash have been made in the last year, which led to a compensation bill of £ 1.9billion.