(Bloomberg) – U.K. drivers may have to pay more than 1,000 pounds ($1,200) annually for car insurance next year, a 28 percent increase, after the government cut a key rate to calculate claims payments.

The average U.K. car insurance premium rose 1.8 percent in the first quarter to 781 pounds, according to data compiled by Confused.com and Willis Towers Watson. The cost “could be on course to drive past the 858-pound peak we saw in 2011,” Steve Fletcher, head of data services at Confused.com, a unit of U.K. car insurer Admiral Group Plc, said in a statement.

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