UK motor insurers suffer 2 bln stg loss in 2010 - Deloitte

British motor insurance prices are set to keep rising after the industry crashed to a two billion pound loss last year, according to a study published on Friday by accountants Deloitte.

The loss, which came as claims outstripped premium income and as insurers set aside more cash against possible future payouts, "will act as another spur to keep upward pressure on motor premiums", Deloitte said.

British car insurance prices have been rising sharply for the last three years as the industry rushes to recoup a surge in personal injury claims, fuelled by the growing influence of "no win, no fee" lawyers.

The annual rate of price inflation for comprehensive cover was 35.7 percent at the end of March, down from 37.8 percent three months earlier, a closely-watched survey from price comparison website Confused.com and consultants Towers Watson.

Prices had previously been falling amid intense competition, and a combination of price weakness and rising claims pushed the industry into an underwriting loss every year between 1994 and 2009, according to financial research firm Celent.

Last year, insurers lost 20 pence for every pound of premium income they earned, slightly worse than 19 pence the previous year, Deloitte said.

Britain's biggest motor insurer is Royal Bank of Scotland , owner of the Churchill and Direct Line brands, and its key competitors include Admiral , RSA , Aviva and mutually-owned Liverpool Victoria.