Motor insurance premiums rise 17.4% in the past year
The average cost of the most competitive motor insurance deals has increased 17.4% in the past year adding to the cost of living pressure in the UK, the latest motor insurance price index published by Consumer Intelligence shows.
Price rises in car insurance are outstripping inflation for the economy as a whole at 10.7% with average premiums now costing £877.
“The surge has been expected this year following the ban on price walking. We have not found it surprising that prices have increased as a result,” says senior Insight analyst Georgia Day.
“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 PCW market reached its highest point since our tracking began in 2014,” she adds.
Premium rises for the over-50s are running at 21% – more than double the rate for the under-25s at 9.1% with motorists in Wales facing the biggest increases at 24.5%.
Prices have increased just 0.1% for the under-25s in the past three months which saw premiums for the market as a whole rise 3.4%.
Telematics quotes are playing a more prominent role in the most competitive deals – the data shows they make up 32% of the best deals which is the highest level since Consumer Intelligence first started tracking it in 2014.
Long-term view
Average overall premiums have increased 32.3% since October 2013 when Consumer Intelligence first started collecting data.
However premiums are down 24.7% over the period for the under-25s while they have increased 67.7% for the over-50s and 44.2% for those aged between 25 and 50.
Age differences in the past year
Older drivers continue to bear the brunt of price rises with premiums up 21% in the past year, but they pay the lowest premiums of all age groups at £449.
Motorists aged 25-50 are not far behind in terms of price rises over the same 12-month period at 19.1% but the annual cost of their car insurance is higher at £645.
The under-25s – who are statistically more likely to have an accident – have only seen prices increase 9.1% in the past year but pay £1,813 for car insurance.
Telematics
The number of telematics products that make up the five cheapest insurance quotes for a typical motorist has increased to a new high of 32% beating the previous record of 30% in January 2022.
Telematics policies base your premiums on how you drive, with insurance becoming cheaper for safer drivers.
The under-25s are most likely to benefit – 67% of the five cheapest insurance quotes for them are telematics compared with 24% for the 25 to 50 age group and just 13% for the over-50s.
Regional differences
Welsh drivers have seen the biggest increases to their car insurance in the last 12 months at 24.5% but all regions have seen double digit increases with the exception of the North East which was just short of double digits at 9.9%
Londoners pay the most for motor insurance at £1,346 followed by the North West at £1,256. The cheapest region for motor insurance is the East Midlands at £463.
| Consumer Intelligence Car Consumer Intelligence Car Insurance Index – Overall | Date range | Overall | Age <25 | 25<=Age<50 | Age >=50 |
| All months | Oct 2013 to Nov 2022 | 32.2% | -24.7% | 44.2% | 67.7% |
| Last year | Nov 2021 to Nov 2022 | 17.4% | 9.1% | 19.1% | 21% |
| Last six months | May 2022 to Nov 2022 | 9.9% | 6.7% | 11% | 10.6% |
| Last three months | Aug 2022 to Nov 22 | 3.4% | 0.1% | 4.2% | 4.8% |
| Year to date | Dec 2021 to Nov 2022 | 18.4% | 11.9% | 19.6% | 21.4% |
| Age group as proportion of batch (Nov 22) | 100% | 24% | 52% | 25% |
| Region | Price Index Last Year (Nov21 – Nov22) | Price Index Last 3 months (Aug22 – Nov22) | Nov 2022 Average Premium (5 cheapest) |
| Wales | 24.5% | 4.6% | £535 |
| South West | 21.1% | 6.5% | £572 |
| South East | 20.7% | 3.2% | £774 |
| London | 19.3% | 3.8% | £1,346 |
| Scotland | 19.1% | 2.5% | £672 |
| East Midlands | 18.7% | 4.7% | £463 |
| West Midlands | 16.1% | 3.8% | £992 |
| Yorkshire & The Humber | 15.5% | 4.3% | £655 |
| Eastern | 14.4% | 2.6% | £844 |
| North West | 14.0% | 2.1% | £1,256 |
| North East | 9.9% | -1.9% | £994 |
