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Northern drivers hardest hit by car insurance price increases

Liverpool skylineDrivers in the north of England have been hit by huge increases in the cost of car insurance over the past 12 months according to new research.

Figures from the latest Watson Car Insurance Price Index show that motorists in areas such as Bradford, Oldham, Manchester and Liverpool have faced premium increases at least double the rate of inflation in 2011.

Across the UK as a whole, the average cost of a comprehensive policy rose by just under 5 per cent last year to reach £844.

Meanwhile, the typical third-party, fire and theft premium was up 10.2 per cent to £1,162.

Hardest hit

The area with the fastest-rising premiums in 2011 was Bradford in West Yorkshire, where the cost of an average comprehensive policy rose 17.1 per cent to £1,435.

As we reported last year, the rise in the cost of cover in the Bradford has become such a concern that the local MP, David Ward, has attempted to take action to curb the rises: they are thought to be largely due to the high number of uninsured drivers in the city.

Oldham and Manchester were the next worst affected, with 12-month increases of 14.8 per cent and 14.4 per cent respectively.

Also in the top 10 were Blackburn, Halifax, Liverpool, Birmingham, Bolton and, in the South-east, Ilford and East London.

The regions with the largest rises in 2011 were Manchester / Merseyside, at 12.7 per cent, and Leeds / Sheffield with 10.2 per cent.

Some good news

The research found some reasons for optimism, however.

The index found that the cost of cover in a number of areas had in fact fallen back over the course of 2011.

The 10 parts of the UK with the biggest falls were either in Scotland or the South-west of England. Falkirk recorded the most dramatic decrease: premiums here fell by 4.6 per cent to an average of £607 for a comprehensive policy.

Drivers in Edinburgh, Dundee, Inverness and Paisley saw typical costs fall by between 3 and 4 per cent. Drops of between 2 and 3 per cent were reported in Exeter, Torquay and Gloucester.

Age differences

The variation in average premiums paid according to age group was also highlighted by the figures. By the end of 2011, the average cost of cover for 17 to 20-year-olds had hit £2,590 a year, while those aged 66 or above would expect to pay just £451.

But there may be more encouraging news for younger drivers: in the final three months of 2011, for example, the cost of a policy for the average 17-year-old fell by 7 per cent. There was a fall in price for all under-20s in the last quarter.

See how much you are likely to pay for cover, based on your age, gender and where you live, by using our special price index calculator.

Changes to come

Gareth Kloet, head of car insurance at said: “This time last year drivers were paying an eye-watering £804 average premium for comprehensive cover, which has continued to rise to a massive £844 over the past 12 months.”

Kloet added that the outlook for 2012 was less clear, with a ban on charging men and women different prices due to come into force in December, and insurers increasingly using technology to assess the risk their customers posed.

He added: “In 2012 we can expect to see new factors affecting car insurance prices such as the introduction of the EU legislation on gender due at the end of this year meaning that insurance cannot be priced according to gender.

“We will also see new technologies affecting car insurance prices such as black-box technology which allows insurers to offer discounts to drivers who can prove that they are careful behind the wheel.”