Car insurance premiums up 8%

Drivers in the UK paid an average of 8% more for motor insurance in the fourth quarter of last year, new figures show.

The typical premium paid for private motor was £470, up 8% on the previous quarter and 7% higher compared to the fourth quarter of 2021, the Association of British Insurers (ABI) said.

Higher prices for energy, paint and materials mean that vehicle repairs now cost more.

From the third quarter of 2021 to the same quarter of 2022, the average paint cost for repairs increased by 20%, while energy inflation is adding £71.75 to each repair.

The cost of courtesy cars is also increasing.

The average price paid to renew an existing motor insurance policy in the fourth quarter of 2022 was £428. For a new policy, the average price was a record high of £531.

Jonathan Fong, senior policy adviser for general insurance at the ABI, said: “Every motorist wants the best insurance deal, especially when coping with cost-of-living pressures, and insurers continue to do all they can to keep motor insurance as competitively priced as possible.

“Yet, like many other sectors, insurers continue to face higher costs, such as more expensive raw materials, which are becoming increasingly challenging to absorb.

“Anyone concerned about being able to continue paying their motor insurance premium should speak to their insurer about any alternative payment options that may be available.”