Insurers drive up cost of being on the road

The biggest one-year hike in motor insurance prices in more than a decade is wiping out any savings hard-pressed motorists are making at the petrol pump.

According to the AA annual survey of motoring costs, the 20% rise in premiums for the typical motorist is ensuring that motorists are not saving any money due to the fall in fuel prices.

The insurance sector is blaming higher levels of claims, more people using the courts to seek compensation and low levels of reserves in the industry for the hikes in premiums.