New research has shown that car insurance premiums are climbing.
Consumers hoping to take out home insurance or breakdown car cover seem likely to struggle to access products with competitive rates in the near future,
new research has suggested.
According to a study published yesterday (April 12th) by the AA, home and car insurance rates are both continuing to increase in the UK in the aftermath of the global economic downturn.
The latest AA British Insurance Premium Index has shown that the average 'shop-around' premiums on annual vehicle cover went up by 40 per cent in the 12-month period ending in March 2011.
This represents the largest ever annual increase recorded by the survey since its inception in 1994, but the company maintains that this trend is unlikely to continue throughout the remainder of the year.
Simon Douglas, director of AA Insurance, noted that "spiralling" premiums and "record rises in fuel costs" are "making driving unaffordable for many".
This follows on from the government's publication of a report aimed at reducing fraud in the car insurance market.
Cold weather earlier in the year resulted in many home insurance claims being made in the UK.
Securing a sufficient home insurance deal could be vital for householders in the UK as cold spells are becoming a regular thing during the winter.
According to Graeme Trudgill - head of corporate affairs at the British Insurance Brokers' Association (BIBA), an intermediary organisation which represents 1,700 providers - the icy conditions seen in Britain throughout the winter were a significant contributory factor to many claims made on contents and buildings insurance policies.
Mr Trudgill explained that the cause of the majority of such annual insurance claims currently is escape of water, as the cold weather caused many pipes "getting frozen, seals breaking and water escaping", which then caused costly damage to residences and properties.
"There have been lots of claims due to the hard winter that we had," he added.
Meanwhile, according to research published by Direct Line, 6.8 million households are underinsured, with homeowners undervaluing the worth of their possessions when taking out their contents and building insurance.
As well as this, more than five million homes have no contents insurance at all.
Head of home insurance at Direct Line Andrew Morrell said that while cash may be tight for many Brits in the wake of the economic downturn, home insurance is still vital.
"No-one wants to think about the prospect of losing all their possessions. Unfortunately it is far too easy to turn a blind eye to the true value of your home's content," he warned.
Those with annual insurance should ensure they inform their provider if they make any home purchases that could affect their cover, including high value TVs or laptop computers.
Meanwhile, UK savers were recently told that money is much safer in a savings account than at home - and this could also ensure that the cost of home insurance is kept low.
