ILC ARTICLE

Premium prices soar by 40%

21st July 2023

Motor insurance premiums have rocketed by a record 40% in the last year, with drivers aged 17-20 seeing policy prices surge by £903 to £2,414.

According to the latest Confused.com Car Insurance Price Index in association with WTW, premiums have risen for every age bracket and in every region, and are now at their highest levels since 2006, with the 40% average increase well above inflation rates of 8.7%.

Meanwhile, premiums have also risen for seven straight quarters, although the 18% rise recorded in the second quarter of 2023 is the highest quarterly jump by some margin.

Tim Rourke, UK Head of P&C Pricing, Product, Claims and Underwriting at WTW, said, “Motorists are facing the sharpest acceleration in premium rates, as insurers continue to grapple with a cocktail of rising costs. High levels of claims inflation are being driven primarily by the sharp rise in used car prices, amplified by rising vehicle theft, spare part delays, longer repair times and higher wages, all pushing costs above premium income and forcing insurers to play catch up by increasing prices.”

Steve Dukes, CEO at Confused.com comments: “The price increases we’re seeing are so significant that it’s going to cause real financial impact to many people. As an industry we have to help drivers understand where they can save money when it comes to renewing their policies.”