No-win no-fee lawyer ads force car insurance hike

There is more bad news today for consumers struggling to keep their heads above the financial mire. According to new research, drivers could be facing a 15 per cent rise in car insurance costs this year and experts say that ambulance chasing, no-win no-fee claims advertisements are partly to blame.

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Together with last year's average rise of 20 per cent, law-abiding drivers look set to pay 35 per cent more for their vehicle insurance than before the recession. A rise in recession-hit uninsured drivers has also helped to push premiums higher.

The findings were reported by market research firm Consumer Intelligence and revealed that around 1.6 million are believed to be driving without insurance – and that leads to an extra £30 per policy for those who pay their way. They estimate that by January 2011 the average driver could see their insurance rise to £648.82.

Worst hit over the past year were young 17 to 24 year-old drivers, whose average premium rose by almost a quarter to a massive £1,489. And while price comparison websites have become our favourite way to find the best quote, the competition within the market has also helped to keep prices down.

Will Thomas, of website, told the Daily Mail: "People will get a shock. Prices have been kept artificially low because the market is so competitive. But now they will have to rise because of the increase in personal injury claims, thanks to injury lawyers ads on the television."

But with inflation rising, petrol prices surging once again and the possibility of so-called 'green taxes' should the Conservative party take power, will a premium hike merely force more motorists to take the no insurance risk?