The UK Office of Fair Trading has said it will be examining recent reports of major car insurance premium rises.

The watchdog agency has said that it will look to establish whether reports that motor insurance premiums have jumped 40 per cent in a year are true, and will also seek the reasoning behind the rise.

Officials also said that it would specifically look into any practices that raised any concerns about competition or consumers. The offices has called on insurance companies and other organisations and enterprises in the industry to provide evidence, including website for premium price comparison.

The agency also expressed that it was interested in reports that premiums in Northern Ireland were much higher than elsewhere in the UK, and said that it would examine provisions for replacing cars after accidents as well as add-on products offered by insurance firms.

OFT personnel are to gather evidence on the matter in the coming five weeks and are expected to table a report sometime in December. The findings will determine whether it will look deeper into rising auto insurance premiums.

The news comes after a report from the AA in April that said motor insurance prices had recently risen at the fastest rate ever seen, noting that premiums had jumped 40 per cent in only 12 months.