Quoted Car Insurance Premiums Drop but They’re Rising for the Under-25s

Quoted car insurance premiums fell 10.5% in the past year but are rising for the under-25s, according to the latest Consumer Intelligence Car Insurance Price Index¹.

Younger drivers experienced a 3% rise in the past three months even though quoted premiums for the market as a whole fell 1.4% in the same period.

Consumer Intelligence’s data shows the biggest impact was on drivers aged 17 to 19 with telematics providers increasingly showing less interest in being competitive in the sector.

Drivers in Wales saw the biggest fall in the past year at 19.6% and over three months by 3.3% with seven other regions – the North West, North East, South East, South West, Yorkshire & The Humber, the West Midlands and Eastern region, recording double digit drops.

Scotland and London recorded the smallest annual falls at 4.1% and 5% respectively and both only saw marginal drops over three months at 0.3%.

Drivers most commonly received a quote between £250 and £499 with 26% of quotes falling in this range and 24% between £500 and £749.

“The biggest change in the market is the increases in competitive premiums for drivers aged 17 to 19 due to less interest in the age group from telematics providers,”

says Max Thompson, Insurance Insight Manager at Consumer Intelligence.

“The past three months has seen increased activity among products available on price comparison websites with 12 leaving and 11 being launched. New brands launched tended to start with price cuts with six more price cut offers available in July compared with April,” adds Thompson.

Long-term view

Average quoted premiums have risen by 98.3% – nearly doubled – since October 2013 when Consumer Intelligence began collecting data.

The over-50s have seen the largest increase, with premiums rising by 122.2%, while the under-25s have experienced the smallest rise at 35.8%. Drivers aged between 25 and 49 have seen average quoted premiums increase by 116.8%.

Age differences in the past year

The over-50s benefited the most from price falls with average quoted premiums down 13.9% in the past year while those aged 25 to 49 saw prices slide 10.5% and the under-25s experienced falls of 2.3%.

Quoted premiums have climbed 3% for the under-25s in the past three months but fallen 2.3% for both the over-50s and those aged 25 to 49.

Telematics

The proportion of the rank one to five quotes that are from telematics providers slipped to 16% compared with 17% in both April and January this year.

The under-50s bore the brunt of with the proportion of top five quotes coming from telematics providers falling to 37% from 39% for the under-25s and to 14% from 16% for those aged 25 to 49. The proportion of top five quotes for over-50s was unchanged at 9%.

Regional differences

All regions saw falls in average quoted premiums over the past year but the decreases ranged from 19.6% in Wales to 4.1% in Scotland and 5.0% in London. Another seven regions saw double digit drops.

All regions saw falls in average quoted premiums in the past three months with Scotland and London recording the smallest decreases at 0.3%. Wales again led the way with the biggest drop at 3.3%.

Ends

Notes to Editors

1. For each risk, common to consecutive months, the variation is calculated from the average of the five cheapest premiums returned on each PCW in the previous month to the average of the Top Five in the current month regardless of which brands provided these quotes. The exercise is repeated on each PCW for each common risk. The Overall Market Top Five monthly variation is calculated by averaging across all these risk level Top Five variations for common risks run in both months. The monthly figures are concatenated up to produce the trended price index from a starting point of 100% in the base month