Car insurance premiums down 16%
Comprehensive car insurance premiums have fallen by 16% in 12 months, according to the latest Confused.com Car Insurance Price Index in association with WTW.
The average annual car insurance premium is now £757, which is £144 lower than this time in 2024 and £238 lower than their peak in December 2023.
Meanwhile, premiums have decreased three per cent, or £20, in the last quarter.
Drivers aged between 17 and 19 benefitted from the most significant falls, with average annual premiums decreasing by 27%, or £775, from £2,826 to £2,051.
Regionally, drivers in the West Midlands saw an annual dip of 18% from £1,110 to £909, while drivers in Manchester and Merseyside saw premiums fall from £1,088 to £896. The smallest reduction was seen in Northern Ireland, where drivers saw a more modest annual fall of nine per cent, or £87, from £939 to £852.
Falling premiums
Steve Dukes, CEO at Confused.com said: “Car insurance prices have been falling for almost 18 months. Insurers are using data to gain a better understanding of customer risk, reducing price to remain competitive in the key target segments most important to them.
“That said, prices are still considerably higher than they were five years ago. In order to tackle the long-term upward trend in pricing, there’s a need for the industry to look at the underlying cost of providing insurance from every angle, harnessing technology and data to increase efficiency while also improving the customer experience.”
Tim Rourke, UK head of P&C pricing, product, claims and underwriting at WTW, said: “Average premiums have continued to retreat from an all-time high in 2023 in the face of rising theft and vehicle repair costs continuing to put pressure on claims inflation.
“The current trend of market consolidation and fear of losing scale to a handful of mega-insurers may be a contributor as insurers continue to drop rates to remain competitive and maintain critical mass, despite pressure on margins likely to persist through 2025.”
