The cost of insuring vans rose by 14.1% to an average of £1,344 per policy in the year ending January 2017, new figures have revealed.
According to research from Consumer Intelligence, the rising premiums are down to the cost of claim payouts going up as insurance companies may need to cover lost business as a result of van owners not being able to work.
The firm’s quarterly Van Insurance Index tracker found that drivers who use their vans as substitutes for cars have been hit the most in the last year, with a rise of 18% to £1,557 for average premiums paid under the “social, domestic and pleasure” banner, compared with an increase of 13% for those who use their vans solely for work under the “carriage of own goods” cover to £1,293.
“The price difference between ‘social, domestic and pleasure’ and ‘carriage of own goods’ is driven by insurers rating customers using vans for work as a better risk as they are more likely to be careful with their vehicle as it’s vital for work,” Consumer Intelligence said.
Those aged 50 and above have seen their premiums rise by 11.2% to an average of £369, while under-25s have seen an increase of 13.7%, and now pay up to £4,707 to insure their LCVs, however premiums for those aged between 25 and 49 rose the fastest by 14.4% to £654.
“Van drivers pay higher insurance bills than car drivers and with more people using their vans for work that adds to the costs of doing business,” said Ian Hughes, chief executive of Consumer Intelligence. “The trend is up across all segments of the market underlining the need to shop around as prices will vary month on month and between providers.”
Carriage of own goods cover can also include social, domestic and personal use but drivers opting for social domestic and pleasure use generally have pastimes or hobbies that suit having a van as either their sole vehicle or as a second vehicle.