Research from GoCompare reveals that since 2012, the average cost of compulsory car insurance excesses has risen well above the rate of inflation.
Depending on their policy, drivers can now face compulsory excesses for a fire, theft or accidental damage claim of up to £3,000, compared with a maximum of £475 in 2012.
Average excesses for accidental damage claims have risen by 26% from £132 in 2012 compared with £166 today. Average theft excesses have increased by 25%, while the average cost of excesses for fire-related claims has risen by 24%.
The analysis also highlighted a massive increase in the range of compulsory excesses over the last seven years, which have expanded substantially from £50 to £475 in 2012 to £50 to £3,000 in 2019.
The historical analysis of policies also revealed a rise in the compulsory excess for inexperienced drivers (motorists aged 25 or over who have not held a full driving license for at least a year). Excesses for these drivers rose on average from £176 to £199, an increase of 13%.
Young drivers are typically viewed as a higher risk to insurers and are subject to the highest compulsory excesses due to their age and inexperience making them more likely to claim.
However, the excesses for these drivers saw the smallest increases. Today, excesses for under 21s are on average £348, compared with £332 in 2012 (a 5% increase). For 21 to 24-year-olds the average excess is 4% higher at £224 from £216 in 2012.
With car insurance premiums hitting an all-time high at the start of this year, many drivers have looked to reduce their premiums by agreeing to pay an additional voluntary excess.
However, research by GoCompare has revealed low levels of understanding about policy excesses, leading the comparison site to warn that many motorists are potentially committing to higher excesses than they can afford – leaving them with a nasty shock if they need to make a claim.
The research showed that only 35% of drivers check policy excess levels when arranging insurance, with the price being a higher consideration. As a consequence, fewer than half (46%) knew the amount of their compulsory excess.