Market Report: The AA’s quarterly review shows insurance costs are rising


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The Independent Online

Bad news for drivers: insurance costs are rising.

Breakdown specialist AA’s quarterly review found that the average cost of a comprehensive policy rose by £6 to £531 – the first increase in two years and expected to continue rising.

The news provided some welcome relief for the down-and-out car insurance sector – Admiral added 42p to 1,285p and Direct Line climbed 8.5p to 279.6p, as both topped the FTSE 100, while esure rallied 13.1p to 235p on the mid-cap index.

The FTSE 100 managed a small improvement, climbing 27.40 points to 6,399.73. GlaxoSmithKline rose 35p to 1,377p, while a UBS recommendation of ARM Holdings lifted the microchip designer 21p to 827p.

Supermarkets continued to feel the pressure after poor Kantar market share data earlier in the week – J Sainsbury slipped 8.4p to 241.6p; Tesco lost 2.9p to 183p; and Wm Morrison was 4.2p lower at 157.9p. British American Tobacco also tumbled 91.5p to 3,375p after admitting that a slow economic recovery in Europe and the strong pound meant revenues in the nine months to September were 9.6 per cent lower than a year earlier.

Zoopla has been under pressure from Agents’ Mutual. But Jefferies yesterday dismissed the challenger as “playful but ultimately harmless”, helping Zoopla improve 13p to 214p.

International Personal Finance climbed 23p to 480p on the mid-cap index, thanks to a 5 per cent rise in third quarter pre-tax profit.

Israeli spread-betting specialist Plus500 rose 49p to 530.5p on the back of a 181 per cent increase in third quarter revenue. But it made no mention of the FCA, which is reported to be taking an interest in how it acquires customers.

Fitbug more than quadrupled in value on AIM, climbing 1.25p to 1.62p after Sainsbury’s and US retailer Target agreed to sell its products in their stores, representing the company’s two biggest deals to date.

Surgical Innovations Group has been combing over its books after full-year figures in September, admitting that redundancies will contribute to higher than expected one-off costs. The medical instrument maker slipped 1p to 1.37p.