Rising insurance premiums might encourage people to trade-in their luxury brand cars

Car insurance premiums are still on the rise, according to statistics from the Office for National Statistics.

Of the categories monitored by the ONS, the cost of car insurance premiums had shot up the most, with a 6.3% rise in April.

It found that the annual rise in the cost of insuring a car has grown by 26.1% which has significantly added to record levels of inflation, according to personal finance portal QCK.com.

Calculations show car insurance alone has added 0.1% on to the massive 3.7% annual rate of inflation in Britain.

Another story from a price comparison website has found that Audi's are the cheapest of German cars to drive. Research by the Association of British Insurers found that Audi's are cheaper in virtually every range.

The news is expected to force people to ask ''should I sell my Bentley?'' as the cost of maintaining such a luxury car continues to shoot up.

The increase in insurance premiums has been blamed on spiralling legal costs, rather than an increase in the amount insurers are forced to pay out to claimants. A spokesman for the group said: "Such costs add around ten per cent to premiums paid by all motorists. These costs must be reduced."

The spokesman concluded: "Government figures have shown that, for personal injury claims under £10,000, for every £1 paid in compensation, a further 76p is paid in legal costs. And the smaller the claim, the more disproportionate these costs are."

Nicki Stafford, Grimsby, VW Bora

Dean McLoughlin, Liverpool, Ford Galaxy