A study by AA Insurance has found that drivers in London are paying the most for their car insurance – with the average premium costing a whopping £922.44.

And – despite a recent fall in car insurance premiums – the average cost could soon increase, with some areas already noticing insurance getting more expensive.

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The AA found that car insurance is the most expensive in London, followed by the IG postal area (including Ilford, Barking and Chigwell), with an average premium of £912.07. In third place, people in Manchester pay the most for their insurance, with an average insurance cost of £820.63.

Car insurance is much cheaper in rural areas, the study found – with quotes on the Isle of Man coming in the lowest, at a very reasonable £231.49 on average.

This was followed by the extreme north-east of Scotland (£252.13), while residents of south-east Cornwall will pay less than a third of those in London (£279.72).

AA Insurance managing director, Janet Connor:

“The premium reflects the likelihood of a claim being made and, in some urban areas, there is much greater risk of a collision taking place, or of car crimes such as theft of or from a vehicle, uninsured driving or attempts at ‘cash for crash’ fraud.

“Sadly, the criminality of some people has a detrimental effect of the premiums paid by honest motorists in such places.”

Large cash for crash gangs often operate in specific areas, which can affect the insurance premiums of people living there.

Connor added:

“Over the past year premiums have, on average, fallen in most areas of the UK and, encouragingly, some of the biggest falls have been in postcode areas that traditionally have paid the highest premiums.

“However, there are some signs of the downward trend reversing with average premium increases in a few postcodes.”

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