Insurers were left with no alternative, according to Hayley Parsons.
Hayley Parsons, chief executive of comparison website Gocompare.com has commented on the above inflation increases in car and home insurance premiums highlighted by the AA’s premium index and Consumer Intelligence.
She said: “The news that car and home insurance premiums are rising by more than 5 per cent a year should not be a surprise. Insurers have been trying to resist price increases by drawing down on their reserves, but the rising cost of personal injury claims on car insurance and the floods last year will have left them with no alternative.
"This will be the last thing consumers want to hear on top of inflation busting increases to energy bills, petrol and food prices. However, the cost of claims has been running well ahead of premium inflation for a number of years now, meaning that the industry as a whole has been unprofitable. If anything, premiums need to rise further and for longer to restore the industry to profitability.
"The message to consumers is to shop-around. Not all insurers are hiking premiums and different providers take a different view of each individual and the risk they represent. As a result, it is more important than ever that consumers shop-around for car and home insurance.”
