On 20/01/2024 08:13 pm, Simon Mason wrote:
The average fully comprehensive car insurance premium in the UK now stands at almost £1,000, according to research published today.
Analysis from price comparison site Confused.com found the average premium is now £995, up from £629 a year ago. The site says the 58-per-cent price increase is primarily down to inflation, which is affecting the cost of replacement vehicles and
repairs.
According to the organisation, increasing traffic volumes have upped the risk of collision, while the rising costs of used cars has made vehicles more valuable and made replacing a vehicle more expensive.
Inflation has also impacted the cost of vehicle components and the cost of labour required to carry out repairs, while the increasing prevalence of technology in cars has also made damage more expensive to repair.
“Like a lot of our expenses, car insurance is getting more costly and this is likely to be the case for some time,” said Louise Thomas, motor insurance expert at Confused.com.
“Claiming is one of the biggest factors when it comes to insurers pricing up policies. And with the cost of paying out for claims being considerably high, insurance prices are going to be, too.”
Most renewals are more expensive
As a result, three-quarters (75 per cent) of UK drivers who received their renewal in the last three months saw their premium rise, with the average increase standing at £98. However, more than a third of those customers switched their insurance
policy to a new provider, saving an average of £96 over their renewal quote.
Just seven per cent of customers received a cheaper renewal quote from their existing provider.
Perhaps unsurprisingly, younger drivers were hit hardest by the increase, with those aged between 17 and 20 seeing their insurance premium rise by more than £1,000 on average over the past 12 months.
For 17-year-olds, that means premiums have more or less doubled to an average of £2,877, while an 84-per-cent increase in premiums for 18-year-olds means they now pay £3,162 a year on average. It’s the first time premiums for 18-year-olds have ever
passed the £3,000 mark.
Postcode car insurance lottery
But Confused.com says youngsters aren’t the only drivers suffering. The average annual premium for drivers up to the age of 43 has now surpassed £1,000, although the figures suggest how much you pay is something of a postcode lottery. Average annual
premiums in central Scotland, for example, remain below £900, while those in central London pay an average of £1,607.
In Northern Ireland, meanwhile, average premiums rose to £1,051 — an increase of 57 per cent that sees the country’s average premium top £1,000 for the first time on record.
Confused.com has also warned motorists that prices could continue to rise, albeit more slowly, for the foreseeable future.
“While it looks like increases could be slowing down for now, we still need to be doing what we can to keep these costs as low as possible,” said Thomas.
“Things like increasing security, reviewing how many miles you drive or adjusting your excess could bring your overall cost down. But it’s important to remember that the information you’re providing should be accurate otherwise you risk
invalidating your policy if you need to make a claim.
“Ultimately, shopping around is the only way to know you’re paying the cheapest price available to you. With prices so high, it’s a very competitive market. So if you look around, there’s likely to be an insurer out there willing to offer a
cheaper price.”
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