Insurance premiums that are already at record levels could rise again between now and January , according to the Association of British Insurers ( ABI ) . An increase in insurance costs helped send premiums 8 % higher to £ 462 in the past year , the association said . It warned that the changes made by the government to the way compensation payouts are calculated could make insurers pay more in accident costs . Those extra costs have so far been absorbed by insurers ' backstop contracts with reinsurers . The ABI said a decision announced by the Government in February to cut the personal injury discount rate "massively increases claims costs" and "will inevitably lead to higher premiums". But with many of those contracts set for renewal in January and the changes to the so - called Standard Rate likely to make them more expensive , insurers will pass those costs on to customers .
Insurance premiums that are already at record levels could rise again between now and January , according to the Association of British Insurers ( ABI ) . An increase in insurance costs helped send premiums 8 % higher to £ 462 in the past year , the association said . It warned that the changes made by the government to the way compensation payouts are calculated could make insurers pay more in accident costs . Those extra costs have so far been absorbed by insurers ' backstop contracts with reinsurers . But with many of those contracts set for renewal in January and the changes to the so - called Standard Rate likely to make them more expensive , insurers will pass those costs on to customers .