I found this on the internet this morning which explains the raise in car insurance. Last year they paid out 95p for every £1 they took in. Thanks a lot boy racers.
http://money.uk.msn.com/money-guides...ntid=154784081
Car insurance is cheap
Would you believe it? On average car insurance is actually cheap compared to what insurers have to pay out for us.
Typically, car insurers pay out 70p to 85p in claims for every pound they receive, but last year was a particularly good year for car owners. 2009 saw the payout rise to an average 95p.
This massive jump explains why car-insurance premiums have shot up this year, because car insurers need to get that ratio under control.
When you add in car insurers' other costs, such as rent and wages, car insurers made a loss in 2009.
Indeed, they have made a loss on premiums for an astounding 14 years in a row at least.
Like life insurers, car insurers can invest our premiums to make more money and they also find it very easy to sell us other more profitable products once they have sold us car insurance. That's where the money is.
Having said that my lad decided he wanted to take his car to uni in cardiff . Parked on the street, fully comp 1years NCB, group 20 with full breakdown cover £51 and ins against uninsured hit and runs £21 Admiral only put his premium up by £102 to £880.