A survey on the motor insurance industry has found that 90% of firms expect to increase premiums in 2009. After professional services firm Deloitte findings, 41% of firms expect an increase of up to 5%, with 42 anticipating an increase of between 5% and 10%.
Although insurance companies have shown an increase in profitability, it was the reserves from previous years will be released into profit margins.
Advertising But while the profitability of May to drop, Deloitte said that the ongoing recession May force companies to obtain and maintain reasonable prices and get premiums down.
51% of those who replied to the survey are optimistic about the trading conditions in the next year, with 49% expect such conditions to deteriorate.
Deloitte says this shows the market "somewhat divided" on how things pan in 2009.
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