Van insurance costs rise by 14 percent in 2016

Van insurance costs rose by 14.1 percent in the year ending January 2017 according to research from Consumer Intelligence, with the average policy costing an average £1,344 per year.

Rising premiums for van insurance are being blamed on an increase in pay-outs related to claims, as insurance companies need to cover lost business as a result of van drivers who can't work.

Van insurance policy types

Consumer Intelligence's Van Insurance Index tracker revealed that drivers who use their van as a car have suffered the biggest hit, with a rise of 18 percent - to £1,557 per year - for average premiums paid for a 'social, domestic and pleasure' policy.

In contrast, van drivers with a 'carriage of own goods' policy - who use their van solely for work - saw an increase of 13 percent, to £1,293 per year.

The price difference between the two policy types is due in part to the fact that insurers rate customers who use their vans solely for work as lower risk. This is because they are more likely to be careful and look after their van as it's absolutely vital for work.

Drivers aged over 50 have seen their premiums rise by 11.2 percent to an average of £369 per year. Meanwhile, those aged under 25 have seen an increase of 13.7 percent, now paying up to a staggering £4,707 to insure their vans. Premiums for those aged 25 to 49 rose by 14.4 percent 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 Consumer Intelligence's Chief Executive Ian Hughes. "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, however drivers who choose this option usually have a lifestyle that requires a van as either their sole or second vehicle.

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