Premium deflation slows for van insurance

• Average van insurance premiums fall 4% in 12 months to December 2021 
• Deflation slowed in last quarter of 2021, with average prices static between October and December.
  

In the 12 months to December 2021, telematics policies, which track driver behaviour, have helped to bring the average cost of van insurance down for new business customers in the UK. However, the downward direction of travel for the cost of van insurance has slowed in recent months – with prices now static when looked at over the last three months of 2021, reveals analysis from acclaimed pricing insights company Consumer Intelligence. The average prices for van insurance now sits at £869. 

“We’ve seen the key telematics brands decreasing their prices in the last three months, as well as some of the big players reducing prices for the younger van driver,” says Harriet Devonald, product manager at Consumer Intelligence. 

Long-term view  

Average premiums have now increased 31.9% since April 2014 when Consumer Intelligence first started collecting data. Van drivers aged 25-49 and the over-50s have borne the brunt of these price hikes – experiencing premium increases of 50.4% and 47.2%, respectively. It’s a different story for younger van drivers aged under 25, who have seen their premiums fall 28% over a similar period. 

Type of cover  

Drivers using their vans for business (£876) are now paying slightly higher premiums than those who use their vans as a car substitute (£851) under a ‘social, domestic and pleasure’ (SDP) policy. In the last 12 months, business users found that their premiums typically fell 4.3%, whereas those that used their vans as a car substitute saw premiums reduce by just 3%. 

Age gaps 

A growing telematics presence in the van market is driving down costs for younger drivers especially. The under-25s have seen their annual premiums plummet by 17.7% in the last 12 months, although prices remain prohibitively high at £2,661. Van drivers aged 25-49 saw their premiums fall 1.2% over the same period, with a typical annual policy now costing £770. For the over-50s, prices have fallen 3.9% over the last 12 months with average premiums just £507.