Motorists using hands-free mobile phone kits while driving are still up to six times more likely than other motorists to have an accident, warned the AA.
Research conducted for the AA motoring Trust showed that having a phone conversation dramatically reduced a driver's ability to concentrate on the road.
On average, drivers are four times more likely to have an accident while on the phone although in some cases this could increase the danger six fold, said the AA.
AA Insurance Services general manager Geoff Hoyle said: "Insurers consider all the circumstances of an accident.
"They can refuse to meet the cost of damage to a driver's own vehicle if they have an accident while breaking the law, and, after 1 December, that will include using a hand-held mobile telephone."
Hoyle said using a hand-held phone would be considered in the same light as jumping a traffic light. "But the same can apply if a driver has an accident because they were distracted by a hands-free telephone," he continued.
"If a conviction for dangerous driving results, the insurer may refuse to meet the cost of damage to the driver's vehicle."
