► Average UK insurance bill passes £1k
► Typical 2024 premium now £1361
► Reflects soaring cost of motoring
The average cost of insuring your car has jumped past £1000 for the first time, according to new data obtained by our sister website Parkers and insurance aggregator Mustard.
Their research found that the average policy now costs £1361.02p, compared with £919.04p in 2022 – reflecting the rising cost of motoring and other household bills in the wake of Covid lockdowns, war in Ukraine and other inflationary pressures.
Hardest hit are young motorists, who now pay an average of £1719 a year for car insurance, according to the research. Ironically, the under-25 age group are the exact demographic who will struggle to pay such lofty bills.
But all motorists are being hit by the rising cost of car insurance: the over-50s have also seen their policies increase by 16.5% over the same two-year period. They now pay an average of £434.
Rising car insurance costs deter people making claims
The topic of expensive motor insurance was discussed this week by the Treasury select committee. Dame Angela Eagle told the hearing ‘my constituents and many people who write to the committee feel that insurance is becoming more of a rip-off. Because the price is going up, it’s harder to make a claim; people, when they do make a claim, often have to wait a very long time or aren’t dealt with very fairly. And that’s particularly the case for insurance that’s compulsory, such as driving insurance.’
Insurance companies blamed higher costs in the supply chain for the rise in premiums: the price of new cars and spare parts have both seen the cost of claims soar, and they are merely passing the cost on, they claim.
Motor insurers paid a record amount in motor claims in 2023, according to the Association of British Insurers. It revealed that £9.9 billion was paid out in car claims last year, equivalent to £1.13 million every hour. It’s the highest figure since the ABI started recording claims data in 2013.