Premiums 'to rise' if drivers fail to shop around

Insurance premiums are sure to rise this year but by shopping around, customers can avoid paying over the odds for essential cover, claims a leading expert in the field.

Motor insurance premiums for new business fell by two per cent over the last 12 months, according to a report by Deloitte published last month, but this year drivers are in for shock if they fail to review their policies claims Richard Mason, managing director of the insurance channel at moneysupermarket.com.

He said: "[Royal Bank of Scotland] have announced that they will be putting their prices up to double digits but they haven't actually announced what those two digits are yet.

"It is without doubt that we are going to be seeing a price rise this year but that doesn't necessarily mean that people should be paying more."

Last year's fall in premiums was put down to an increasingly competitive insurance marketplace when insurers were slashing premiums in order to maximise their market share.

However, Mr Mason's comments act as a stark reminder for drivers that if they fail to make sure they have the right insurance deal they could be paying too much for their cover.