Thursday 23 October 2014

Cost of running family car still above €10,000

Published 26/08/2014 | 02:30

AA Ireland spokesman Conor Faughnan
AA Ireland spokesman Conor Faughnan

A SHARP increase in car insurance costs has kept the cost of running a family car above the €10,000 mark this year.

The increase in insurance premiums offset the benefits of price drops in several other areas of motoring, a new survey shows.

Overall the cost of running a typical family car is €10,571.20 - down by just €75.12c over the past 12 months, according to the AA study.

But motorists would have felt the benefit of more than €6.26 a month in their pockets, had insurance costs not increased by a significant 8.5pc in the year from July 2013.

AA Consumer Affairs director Conor Faughnan said: "There's a hefty hike across the board but it is not distributed evenly so you really have to shop around.

"Some insurers had well-documented problems last year and we know that there were more accidents."

He added: "If you're not happy with the renewal price you're quoted, shop around. While premiums are up across the board, some have hiked prices more than others."

Diesel

The report says the price of fuel has not had much impact on running costs recently. The average price of a litre of unleaded petrol in July was €1.574 compared with €1.576 for the corresponding month in 2013.

There has been a slight fall (0.7pc) in the price of diesel over the same period with the average for July at €1.476 per litre.

But here has been a 3pc decrease in the price of new cars and a 2pc drop year on year in the price of tyres, servicing, repairs and parking.

Other elements taken into consideration when calculating the cost of running a car include depreciation, replacements, repairs, interest, tax, and NCT charges.

The headline figure assumes that the car has been bought from new and costs are spread over an eight-year period.

Average annual mileage is calculated at 16,000km. However, the rise in car insurance premiums has thrown a spanner in the works.

The car taken as typical for the annual AA report's calculations has changed this year.

Previously they took a Band C car (€390 road tax) to be the average family motor.

However, the purchase of increasing volumes of lower-emission cars means the AA now takes Band B vehicles (€270/€280) as their template. Nearly three times as many Band B vehicles were purchased in 2012 than Band C cars.

Irish Independent

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