Pet and car insurance pricing are on the uptick, as per the latest data, but have policyholders weathered the worst?
Pearson Ham Group’s Pet Insurance Price Index shows that pet insurance pricing has returned to moderate growth, ending the reductions seen in the first quarter.
The top five priced policies for Lifetime cover, the most sought-after form of pet insurance, increased by 0.7% in June, making prices 12% higher than the same period last year.
Regional disparities are evident, with the North East experiencing the largest monthly increase in June at 1.5% and the highest year-on-year increase at 18%. Northern Ireland was the only region to see a decrease in insurance pricing, with a 0.7% drop. The South West saw the lowest increase in the month at 0.2%.
Stephen Kennedy (pictured above, left) of Pearson Ham Group stated that the price reductions in pet insurance premiums observed after the CMA announced an investigation into veterinary practices have been short-lived.
“This shift may be due to increased veterinary costs and a rise in claims frequency, which have started to push prices up again. As these cost pressures continue to impact the market, pet insurance prices may well return to sustained upward pressure,” Kennedy said.
Meanwhile, in the car insurance sector, the average quoted price rose by 34% in the year to May, according to the Consumer Intelligence Car Insurance Price Index.
However, the worst may be over, with quoted premiums falling in the past three months. The three months to May saw average quoted premiums fall by 1.3%, the first quarterly drop since late 2021. The previous quarter recorded increases of just 0.5%.
Almost all regions saw falls in quoted premiums, with the largest decrease in Wales at 3.9%, followed by London and Yorkshire & The Humber with 2.1% decreases. The South West saw a price increase of 0.8%.
Data from May shows that drivers most commonly received quotes between £500 and £749, with 21% of quotes in this range. Around 58% of quotes were below £1,000, with about 18% of under-25s receiving quotes for less than £1,000, compared with 84% of over-50s and 58% of those aged 25 to 49.
Max Thompson (pictured above, right), insurance insight manager at Consumer Intelligence, indicated that the escalation of car insurance premiums may be ending, with insurers now reducing premiums to rank higher on price comparison websites.
“Insurers are making their pricing efforts more visible to consumers. There are now more price cut offers visible on quotes than messages relating to cover benefits, which is the first time this has been the case since July 2022,” Thompson said.
Read More: UK car insurance costs down in Q1
Long-term data shows average quoted premiums have risen 122.7% since October 2013. Increases were highest for the over-50s at 165.1% and lowest for the under-25s at 36.5%. Drivers aged 25 to 49 saw average increases of 142.6%.
Age differences in the past year show that the under-25s experienced the biggest increases in quoted premiums at 44.2%, while those aged 25 to 49 saw a 33% rise, and over-50s had a 28.1% increase.
Telematics providers have become slightly more competitive, offering 16% of the top five quotes in May compared with 15% in February. Younger drivers benefited the most, with 40% of the top five quotes for under-25s coming from telematics policies. For other age groups, the proportion remained unchanged at 5% for over-50s and 13% for those aged 25 to 49.
Regional differences in car insurance premiums over the past 12 months show that Scotland, the West Midlands, and London saw the highest increases at 39.1%, 37.8%, and 37.7%, respectively. The lowest rise was in Wales at 25.6%.
However, almost all regions recorded reductions in quoted premiums over the past three months, with the biggest drops in Wales at 3.9%, followed by London and Yorkshire & The Humber with 2.1% decreases. The South West was the only region with an increase of 0.8%.
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