The cost of motor insurance fell in 2018, the first calendar year fall since 2014, according to the Association of British Insurers’ (ABI) latest Motor Premium Tracker, published today. The overall fall came despite a rise in the average premium paid in Q4 of 2018 over the previous quarter, which is in line with the seasonal trend.
The ABI’s Premium Tracker is the only survey which measures the price that consumers pay for their motor cover, rather than prices quoted.
The figures reveal that:
The average price paid for motor insurance in 2018 was £477, down 1% on the previous year.
In line with the seasonal trend, the average price paid for cover in quarter 4 of 2018 rose slightly on the previous quarter, up by 2% to £479. However, this was the lowest quarter 3 to quarter 4 rise since 2013. The rise in average premiums reflected lower car sales, with insurers’ fixed costs needing to be spread across fewer motor polices.
Mark Shepherd, Assistant Director, Head of General Insurance Policy, ABI, said:
“This annual fall is good news for millions of UK drivers after a few years of rising premiums, that reflected, in part, rising vehicle repair costs, a weaker pound, and uncertainty around the reform of personal injury compensation. Implementing the provisions of the Civil Liability Act will be crucial to delivering a fairer compensation system for claimants and continued competitive premiums for motorists. Despite reports suggesting premiums are going up, what we actually saw was an overall fall in the average motor premium paid in 2018, with the seasonal rise in quarter four premiums lower than normal.”
The number of private domestic motor policies increased marginally for 2018, with the number of policies at an all time high. Similarly, GWP has also increased for the year, surpassing the £13 billion mark for the first time.