The latest figures from a car insurance price index deliver some much-needed relief for UK motorists, despite some notable upticks.
Confused.com’s price index, in collaboration with WTW, shows a 5% decrease (£54) in comprehensive car insurance premiums over the past three months, with UK motorists now paying an average of £941.
Despite this recent dip, however, there has been a significant annual increase of 43% (£284) in premiums, as reported by car insurance price index, which gathers data from over six million customer quotes in the UK each quarter.
Regionally, all areas of the UK reported decreases in car insurance costs over the last quarter. Northern Ireland experienced the largest percentage drop of 8%, bringing the average premium down to £968. Meanwhile, Central Scotland saw the smallest quarterly decrease of 3%, with premiums now averaging £871.
The South West remains the least expensive region for car insurance at £606, while Inner London, despite a significant £106 reduction over the last quarter, remains the most costly at £1,501. Notably, the West Midlands has overtaken other regions outside London with the highest premiums now at £1,157.
More detailed local data reveals that North West London saw the largest quarterly decrease, with premiums falling 9% from £1,680 to £1,529. Conversely, West Central London remains the most expensive postcode for drivers, with an average premium of £1,815. Llandrindod Wells in Wales continues to offer the UK’s cheapest premiums, now at £557.
Tim Rourke, UK head of P&C pricing, product, claims and underwriting at WTW, commented on the trends driving premiums in the sector.
“After a series of record highs in 2023 took car insurance premiums into uncharted territory, the latest pricing data suggests the relentless rise in prices may finally be turning a corner,” Rourke said. “Even with inflation easing, however, more vehicles with advanced technology that require complex and expensive repairs and higher rental vehicle costs, increased frequency and severity of claims and ongoing supply chain issues risk a perfect storm of issues that can be expected to continue to put pressure on car insurance premiums.”
Among different age groups, drivers aged 28 experienced the most significant quarterly price drop of 9%, reducing their premiums to £1,353. In contrast, the youngest drivers, particularly those aged 17, saw a 1% increase in their premiums, which now average £2,919.
Steve Dukes, CEO at Confused.com, also shared his perspective on the trend and what it means for UK drivers.
“While the cost of car insurance may have dropped at the beginning of this year, customers are still paying historically high prices for their car insurance. Premiums are still more expensive year-on-year, so as an industry, there’s still an important role to play in helping customers to understand where they could be saving money,” Dukes said.
What are your thoughts on this story? Please feel free to share your comments below.
