NCREASING car insurance fraud is contributing to the fastest-ever increases in premiums, says one leading motoring organisation.

This follows a report suggesting that one in 20 motorists aged under 35 has 'staged' an accident in order to make a fraudulent claim.

As a result young drivers are now finding their premiums rising faster than average, according to AA Insurance. Simon Douglas, director of AA Insurance, said: "The AA has been tracking the movement of average car insurance premiums across the industry for 16 years and premiums are now rising at their fastest ever rate.

"The price of a typical comprehensive car insurance premium, currently about £704, rose by 30.9 per cent over the past year. In just three months, premiums rose on average by 11.5 per cent and, for drivers under the age of 30, to £1,128."

"While the organised 'cash for crash' scams that ripped millions of pounds off insurers have made headlines, the problem of car insurance fraud is much deeper and has become one of the principal drivers of insurance premium inflation," he says.