Quoted car insurance premiums rise 34% in a year - But the worst could be over

• Quoted premiums fell 1.3% in the past three months and insurers are cutting prices to win business 

• In May, motorists most commonly received a quote between £500 and £749, Consumer Intelligence data shows 
  
  

The average quoted price of car insurance rose by 34% in the year to May, but the worst could be over with quoted premiums falling in the past three months, the latest Consumer Intelligence Car Insurance Price Index ¹ shows. 

The three months to May saw average quoted premiums fall by 1.3% - the first quarterly drop since the last three months of 2021. The previous quarter recorded increases of just 0.5% - the lowest quarterly rise since November 2021. 

Almost all regions saw falls in quoted premiums with the biggest in Wales at 3.9%, followed by London and Yorkshire & The Humber with 2.1% decreases. The South West, however, saw price increases of 0.8%. 

Data shows that in May this year, drivers most commonly received a quote between £500 and £749, with 21% of quotes falling in this price range. Around 58% of quotes were below £1,000, with around one in five (18%) under-25s received quotes for less than £1,000, compared with 84% of over-50s and 58% of those aged between 25 and 49. 

“The escalation of car insurance premiums may finally be at an end, with insurers now reducing premiums and jostling to get to the top of screen on the price comparison website results pages,” says Max Thompson, Insurance Insight Manager at Consumer Intelligence. 

“Insurers are making their pricing efforts more visible to consumers. There are now more price cut offers visible on quotes than messages relating to cover benefits, which is the first time this has been the case since July 2022.” adds Thompson. 

Long-term view 

Average overall quoted premiums have risen 122.7% - more than doubled - since October 2013 when Consumer Intelligence first started collecting data.  

They have increased the most over this time for the over-50s with a rise of 165.1%, and the least for the under-25s at 36.5%. Drivers aged between 25 and 49 have seen average increases of 142.6%. 

Age differences in the past year 

The under-25s have experienced the biggest increases in quoted premiums at 44.2% while for those aged between 25 and 49 quoted premiums have risen 33% since May 2023 and over-50s have seen increases of 28.1% last year. 

Telematics  

Telematics providers have become slightly more competitive offering 16% of the rank one to five quotes in May compared with 15% in February, which was the lowest level for five years. 

Younger drivers are benefiting with 40% of the top five quotes for under-25s coming from telematics policies, compared with 36% in February. The proportion of rank to five quotes from telematics for other age groups was unchanged at 5% for the over-50s and 13% for those aged 25 to 49. 

Regional differences 

Average quoted premiums have risen the most in the past 12 months for drivers in Scotland, the West Midlands and London, with increases of 39.1%, 37.8% and 37.7% respectively. The lowest rise was in Wales at 25.6%. 

But almost all regions recorded reductions in quoted premiums over the past three months with the biggest drops seen in Wales at 3.9%, followed by London and Yorkshire & The Humber with 2.1% decreases. The South West was the only exception with an increase of 0.8%.  

Insight that will enable you to optimise your pricing strategy 

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