More vehicles are being driven without insurance and having accidents.
Approximately 58,000 were crushed last year – a rate of more than 1,000 a week.
The Motor Insurer’s Bureau, is looking at why they have increased in the year to July by almost 10% to about 12,000 after declining since 2004.
MIB expects to pay out £256m from a fund provided by insurers at a cost of £15 to each motor premium.
Reasons for the rise could include more uninsured driving on UK roads, but increases in the number of drivers and the effect of claims management companies may also be a factor.
The MIB’s chief executive, Ashton West, said, “In the last year or so, for the first time in a decade or more, we are starting to see the trend of reduction actually change direction, and we have started to see it increase.”
The number of claims from victims of uninsured or hit-and-run drivers had fallen from around 25,000 in 2004 to just under 11,000 last year, before the 2016/17 rise.
Police seizures of uninsured vehicles are also on the increase. According to MIB data, 145,000 were taken off the road in 2016, a rise on the year before.
The MIB operates the insurance database used by police forces to check the status of vehicles being driven.