Research shows making a claim on your car insurance adds £184 to your average annual premium

Claiming on your car insurance could cause your annual premium to leap by an average of £184, according to new research by comparethemarket.com.

The new figures show the cost of submitting an insurance claim if your vehicle is stolen or in an accident.

The research found that the annual cost of insurance soars to an average of £844 if a driver has made an insurance claim in the past year. This is substantially more than the typical £660 premium for a driver who has made no claims in the past five years.

However, the cost of insurance will typically fall each year if a motorist does not submit any new claims after their initial incident. The average premium for a driver that made a claim between one and two years ago is £705.

More drivers could soon be forced to pay higher premiums due to an increase in insurance claims. There has been a rise in claims submitted in recent months as more people are making regular car journeys following the lifting of the COVID-19 travel curbs.

Enquiry data from comparethemarket.com suggests there was a 39% increase in insurance claims in the spring (March 21-May 21), compared with the most recent winter (December 20-February 21). There may be a further rise in claims in the coming weeks after the COVID restrictions ended on 19 July.

The impact of making a claim on the cost of a driver’s annual premium varies significantly depending on whether they were at fault for the incident. The typical premium for a driver who was at fault for an incident in the past five years is £742. If another driver was to blame for the incident, then the average premium is £640 – £102 cheaper. If both parties are at fault for the incident, then the typical premium will cost £778.

As expected, the most serious incidents raise premiums the most. The average premium for a driver who has written off their car in an incident in the past five years is £748. This is £88 more than the average premium for a driver with no claims in this timeframe. The average premium for a driver who had their car stolen in the past five years is £836 – £175 higher than the average for a driver with no claims.

Dan Hutson, Head of Motor Insurance at comparethemarket.com, said: “Motorists need to be careful if they plan on driving more often now travel curbs have been lifted. Our figures show how costly it can be to renew your car insurance if you’ve recently made a claim. Whether an accident was your fault or not, making a claim will usually lead to an increase in your premium when you renew. The best way to minimise the impact on your premium if you have made a claim is to shop around for a cheaper deal when your policy ends. Drivers can typically save £92 on car insurance if they switch.

“If you’ve had an accident you don’t have to claim on your insurance. However, you do need to tell your insurer about the incident, even if you were not at fault. It may be tempting to keep quiet, especially if you think it might save you from a price hike. But if your insurer finds out later from the other driver or another party, then they could refuse to honour your policy for failing to report it. Any increase in your premium will usually be much cheaper than the thousands of pounds it could cost to cover any repairs from an accident out of your own pocket.”