Norwich Union, the company which claims it will quote you happy, is increasing premiums by 40% for some young drivers.
Insurance premiums have risen considerably since the 1960s
Worst hit will be younger men, but the majority of all customers will see their annual payments rise.
The company says it has been forced to impose the increases because the premiums they are collecting do not cover the cost of repairing damage and compensating people for injuries.
The insurance industry complains that uninsured drivers are a worsening problem.
In 2005 payments by the Motor Insurers' Bureau (MIB), which compensates other road users in the event of an accident with an uninsured driver, totalled £320 million.
The MIB scheme is funded by a compulsory levy on car insurance premiums, which currently adds around £30 to the average comprehensive premium of £750.
Fraudulent claims and in particular, staged accidents are another source of rising costs, adding around £40 to premiums.
Staged accidents are when gangs sandwich an innocent driver between two cars, making it seem as though he or she is at fault.
Personal injury claims are also added to insurers' costs, with the average claim doubling to £2,800 in the last five years.
Watch Simon's full report, which also contains some useful information to help young drivers reduce their insurance costs.
VIDEO: Insurance Increase