The average cost of the most competitive motor insurance deals rose by 17.4% in the past year, according to the latest motor insurance price index by Consumer Intelligence.
The rising cost of motor insurance has added to the cost-of-living pressure experienced by Britons, the report said. With average premiums now costing £877, price rises in car insurance have outstripped inflation for the wider economy at 10.7%.
“The surge has been expected this year following the ban on price walking,” said Georgia Day, senior insight analyst at Consumer Intelligence. “We have not found it surprising that prices have increased as a result. What is surprising, however, is the number of product launches we are seeing, especially the growing number of essentials products. To highlight this, the number of total brands quoting across the [price comparison website] market reached its highest point since our tracking began in 2014.”
Rates for older drivers increased by 21% for over-50s. This is more than double the rate of increases for under-25s at 9.1%. Meanwhile, motorists in Wales faced the largest increases at 24.5%., followed by the South West (21.1%) and the South East (20.7%). London was in fourth place at 19.3%, followed by Scotland at 19.1%.
The increase in the North East was the smallest in the UK at 9.9%.
According to Consumer Intelligence, telematics quotes are playing a more prominent role in the most competitive deals, with data showing that telematics policies make up 32% of the best deals –the highest since the analytics firm began tracking the usage-based segment in 2014.
For the long term, average overall premiums have increased 32.3% since October 2013, when Consumer Intelligence first started collecting data. Over that same period, premiums are down 24.7% for drivers under 25, while premiums increased 67.7% for over-50s and 44.2% for those aged between 25 and 50.
