The cost of car insurance is still increasing, but house insurance continues to be good value for money, revealed the AA in its British insurance premium index.
The AA index tracks quarterly changes in car and home insurance premiums based on 500 risks for each of car, home buildings and home contents premiums.
The AA said the lowest premiums for car insurance had risen by more than 3% over the past quarter, compared with an overall average increase in motor premiums of 1% over the same period.
"Insurers say claims costs have risen faster than the rate of inflation over the past year and this cost will have to be met by increased premiums," said AA Insurance Services managing director Andrew Briscoe .
Average home insurance cover remained stable, said the AA, up 0.23% over the quarter. The three lowest premiums available, however, fell by over £4 for buildings and £2 for contents.
Briscoe said the AA expected home insurance premiums to rise because of a high number of subsidence claims following the hot summer.
He said new companies entering the home insurance market had introduced aggressive pricing, resulting in stable premium prices.
