The average UK motor insurance premium increased to over £700 during the second quarter of 2022, according to a leading price comparison site. Figures from CompareTheMarket.com showed the average premium rose by more than £50 compared with the same period last year, meaning a typical motorist is now paying £704 a year.
In comparison, the site claims the average premium for the three months from the beginning of April to the end of June 2021 stood at £653. But the £51 uplift in prices means last quarter was the most expensive since the final quarter of 2020, when average prices hit £724.
According to CompareTheMarket.com, the price hikes are down to “increased cost pressures for insurers”, including an increase in second-hand car prices and rising repair costs as cars become more complex and parts get harder to come by. The end of coronavirus restrictions has also caused traffic levels to increase, leading to a rise in the number of accidents and therefore insurance claims.
And it isn’t just average premiums that are on the up. The figures also show the cheapest average quote rose to £582 in the second quarter, up £34 compared with the same period last year. However, the gap between the average premium and the cheapest available premium is widening, meaning there are now larger savings available to customers who shop around, even if overall prices are still rising.
The data also shows young drivers stand to gain more from switching providers, with the average premium for drivers aged 17-24 now standing at £1,247 – £135 more than over the same period in 2021. But the cheapest average quote for drivers in that age range was a massive £259 lower.
“Drivers will be concerned that the cost of car insurance is rising when household finances are already under pressure from high fuel prices and the wider cost of living crisis,” said Julie Daniels, motor insurance expert at CompareTheMarket.com. “Our figures show the average premium has increased by £51 year-on-year due to the rising cost of repairing or replacing vehicles and higher value of second-hand cars.
“Drivers looking to cut the cost of car insurance should consider shopping around for a cheaper deal when their policy comes up for renewal. Motorists could save an average of £122 by switching insurers. As car insurance for young drivers is so expensive, it is a particularly good idea for these motorists to shop around. This could typically save young drivers more than £250. A quick and easy way to find a great deal ahead of your renewal can also be by signing up to automated car insurance renewal quotes. comparethemarket.com automatically notifies customers whose policy is about to end about any available deals and savings to be had.”