Fuel savings wiped out by insurance cost

Irish motorists have not benefited from dramatic falls in the price of fuel over the past 12 months because increases in insurance premiums have wiped out any savings, a new survey reveals.

The AA study put the average annual cost of running a family car at €10,594, down just €18 on last year’s figure.

Fuel prices are down compared to 2014, but those gains are swallowed up by an average 20 per cent rise in insurance premiums for the typical motorist.

"This is the biggest one-year rise in insurance prices in well over a decade," said the AA's director of consumer affairs Conor Faughnan.

“It marks a big change in the market with insurers nervous about rising claims and about improving their reserves.”

He said prices were rising across the board. “Unfortunately the trend is set to continue for the rest of the year and into 2016.”

Mr Faughnan said the average price of petrol was 145.3 cent a litre in July, just over 7 per cent less than 12 months ago.

Each year the AA illustrates the cost of running an average family car.

The cost of running a Band B category car fell by 0.165 per cent this year compared to 2014.