Motor insurance up 16%

The ABI’s latest Motor Insurance Premium Tracker has revealed that the overall average premium paid for private comprehensive motor insurance was £478, up two per cent on the previous quarter and 16% higher than the same period in 2022.

The average price paid by motorists renewing their cover rose by £8 to £436 while the average premium for a new policy was up £14 to £545.

The rise reflects above inflation cost pressures motor insurers continue to face, such as higher raw material costs for vehicle repairs, increased energy costs and the steepling costs of courtesy cars.

Jonathan Fong, the ABI’s senior policy adviser, Motor Insurance, said: “With households battling the rising cost of living, the last thing anyone wants is a higher motor insurance bill. Naturally, every motorist wants the best insurance deal, and insurers are doing all they can to keep motor insurance as competitively priced as possible. Yet, like many other sectors, insurers continue to face higher costs. The price of certain raw materials and energy costs are rising at rates well above general inflation, and these costs are becoming increasingly challenging to absorb.”