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Quoted motor insurance premiums accelerate with record rise

Average quoted car insurance premiums have also seen a record 22% rise in the three months from May to August – the biggest quarterly increase for the index, since tracking began in October 2013. Telematics providers are becoming less competitive accounting for just 17% of the top five quotes compared with 21% just three months ago.
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25 October 2023

 

THE average quoted price of car insurance rose by 61% in the year to August– the highest annual increase on record, the latest Consumer Intelligence Car Insurance Price Index   shows.

Average quoted car insurance premiums have also seen a record 22% rise in the three months from May to August – the biggest quarterly increase for the index, since tracking began in October 2013.

Telematics providers are becoming less competitive accounting for just 17% of the top five quotes compared with 21% just three months ago.

That has particularly hit younger drivers and telematics providers now account for just 41% of the most competitive quotes for under-25s compared with 53% three months ago. Under-25s are seeing rises in quoted premiums of 66.7%.

“Motorists of all ages have seen new business quotes soar over the last year and many will likely be feeling the pinch in their household budgets against a backdrop of other rising costs of living,” said Max Thompson, Insurance Insight Manager at Consumer Intelligence.

“Competition from telematics has reduced for a second consecutive quarter. This drop-back in telematics delivering competitive quotes has likely triggered the sharper increases in competitive premiums seen this quarter, as telematics quotes are usually significantly cheaper than traditional quotes.”

Long-term view

Average overall quoted premiums have more than doubled by 102.9% since October 2013 when Consumer Intelligence first started collecting data.

Quoted premiums are at their highest levels since Consumer Intelligence records began with 66.2% of the increase happening since December 2022.

Age differences in the past year

The over-50s have seen the smallest increases in quoted premiums in the past 12 months at 56.3% compared with 61% for those aged 25 to 49 and 66.7% for the under-25s.

Telematics

The proportion of competitive price comparison website quotes provided by telematics providers for young driver has fallen to a six-year low comparable with February 2017.

The fall in competitiveness for telematics is partly explained by changes implemented by leading providers. Hasting Direct YouDrive which was a market leader at the start of the year and particularly in the 20 to 24-year-old market has increased premiums while QuoteMeHappy Connect which only quoted ages 17 to 29 withdrew from the market towards the end of July.

Regional differences

Average quoted premiums have risen the most for drivers in London, the West Midlands and the South East with increases of 69.5%, 64.4% and 64.2% respectively.

Drivers in the North West are experiencing the lowest rises in quoted premiums but even they face rises of 55%.

 

Region Price Index past 12 months (August 22 to August 23)
London +69.5%
North West +55%
West Midlands +64.4%
 Yorkshire & The Humber +60.2%
 North East +56.1%
 South East +64.2%
 Eastern +60.7%
 Scotland +60.6%
 East Midlands +58.1%
 Wales +56%
 South West +59.5%

 

 

 

 

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Chris Wright

Chris Wright

Chris Wright has been covering the automotive industry nationally and internationally for 30 years. Following spells with consumer titles he became News Editor of Automotive Management (AM), Editor of Automotive International, International Editor for Detroit-based Automotive News, and Editor of Dealer Update. He has also co-authored several FT Management Reports and contributes regularly to Justauto.com

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