New figures from the Association of British Insurers have found that motor insurance premiums rose 12% in the fourth quarter of 2023.
Average policies increased from £526 in the third quarter to £627 in the last three months of the year. This is 34% higher than the average motor insurance policy in the fourth quarter of 2022, which was £470.
Taking the year as whole, prices rose by more than 25% from 2022.
Meanwhile, payouts for vehicle thefts rose 35% in the third quarter of 2023 compared to the same period the previous year, while repair costs spiked by 32% to £1.6bn.
The research also revealed that electric vehicles are approximately 25% more expensive to repair than their petrol equivalents and take 14% longer.
Mervyn Skeet, Director of General Insurance Policy, ABI, said, “We’re acutely aware of the impact that rising motor insurance premiums continue to have on motorists. Rising repair costs and other factors outside of insurers’ control mean there is no single action that could bring down premiums. However, we are determined to do all we can to put the brake on.
“We are working with our members to understand what actions can be taken to help motorists manage costs. The cost of paying monthly (premium finance) is one of a number of topics we continue to discuss with our members and the Financial Conduct Authority (FCA). We’ve also been very clear, and continue to underline, that cutting Insurance Premium Tax would provide immediate relief for stretched consumers. We will be saying more, as we can, on other steps we will take in the coming weeks.”
