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Newsletter

Cold winter 'will drive up insurance rates'

By Marianne Straker, Fri 12 Mar 2010 - Published in Home Insurance

The increase in insurance claims caused by the recent bad weather will cause prices to rise, it has been predicted.

Recent figures from the Association of British Insurers showed that 335,000 claims were entered for damage to homes, businesses and vehicles after the UK suffered the coldest winter it has seen for 30 years, creating payouts of around £650 million.

Steve Foulsham, technical services manager for the British Insurance Brokers' Association, commented: "Once we know all the figures it wouldn't surprise me one little bit if it leads to some sort of rate hikes in the market, because of the sheer volume of claims."

He added that one of the main areas where claims have risen dramatically is for burst pipe in homes, which leads to higher payouts because many people now have designer furniture and more expensive items which are damaged.

In addition, Mr Foulsham also noted that vehicles sliding on icy roads was a common problem in the cold spell, causing a significant number of car insurance claims which providers were not expecting.