The average car insurance bill in Britain has skyrocketed to almost £1,000, with costs rising by £284 in the past year.
Eye-opening new figures revealed the rise in car insurance premiums, with the average cost rising by £403 over the past three years.
Last year alone, the average cost of car insurance rose by 43 per cent, from £657 in the first quarter of 2023 to £941 in the first quarter of 2024, says comparison site Confused.com.
The staggering figures expose the extra costs that cash-strapped drivers face, among other financial pressures due to the cost of living.
Drivers are becoming increasingly furious over how much they have to pay, with an MP telling a government committee earlier this week that her constituents ‘feeling that insurance is becoming more and more of a rip-off’.
Your browser does not support iframes.
The average cost of buying new car insurance in Britain is now £941, according to the latest index from Confused.com.
Although this figure is actually £54 lower than in Q4 2023 when average prices reached £995.
Although prices have dropped slightly compared to the end of last year, drivers are still paying much more now than in 2021.
Between January and March 2021, drivers paid an average of just £538, rising to £550 for the same period in 2022.
After the Covid pandemic reduced car insurance premiums for many, due to reduced traffic on the roads, causing claims to fall, average prices started to rise last year. In 2023 they rose from £657 at the start of the year, to £776 in the second quarter, £924 in the third quarter and finally to £995 at the end of the year.
The price of car insurance can vary significantly depending on people’s age, driving history, car and location. Insurers are not supposed to price based on gender, but there remains a wide variation between average costs for men and women.
Men now pay an average of £1,001 for their car insurance, while women pay an average of £841, with the price difference being £160.
According to Confused.com, this is because men have a higher risk profile than women as they tend to drive ‘more expensive cars with bigger engines and more technology’, leading to a more expensive claim if they are in an accident.
The average cost of buying new car insurance in Britain is now £941, according to the latest Car Insurance Price Index from Confused.com (Stock Image)
Young motorists hammered for car covers in front of thousands
According to the data, younger people are also likely to receive higher insurance premiums.
Drivers aged 17 now pay an average of £2,919, which is £1,307 more than last year, while 18-year-olds are paying £1,300 more than 12 months ago, with prices rising from £1,845 in 2023 to £3,145 in 2024.
This compares to current prices for people aged 45, 55 and 65, which average £892, £666 and £545 respectively.
Insurance debt is increasing due to inflation, which points to the price of repairs and labor costs. Cars have also become more expensive to repair due to the requirement to replace entire damaged parts rather than smaller parts.
Prices are also rising as the number of cars on the road has increased since the Covid-19 pandemic, meaning there is a greater risk of collisions with other vehicles.
As the price rises, it is more difficult to make a claim; When people do submit a claim, they often have to wait a very long time or are not treated fairly
However, critics have argued that car insurance prices have risen more than necessary. The huge rise in the cost of car insurance has led some motorists to express their anger over such price increases to their local MP.
Treasury Committee member Dame Angela Eagle appeared at an insurance hearing earlier this week and explained the frustrations of her constituents.
She said: “My constituents and many people writing to the committee believe that insurance is increasingly becoming a rip-off.
‘As the price rises, it is harder to make a claim; When people do submit a claim, they often have to wait a very long time or are not treated fairly.
‘And this especially applies to mandatory insurance, such as car insurance.’
An aerial view of rows of newly built cars and vehicles ready for export and import and delivery to sales dealers in Tamworth, UK
She asked David Mendes da Costa, chief policy manager at Citizens Advice, if this is the kind of approach the charity is seeing.
He said: ‘I think the people who come to us for support… get the price they’re offered and have no idea what’s behind it.
‘And often they are not aware that, based on things like where they live and their zip code, they have to pay much more than someone who even lives across the street. or a few blocks away.
“There’s no transparency, and I think that lack of transparency is probably the cause of the low level of trust that we see in the industry.”
Mr Mendes da Costa told the hearing that the charity is seeing a ‘marked increase’ in the number of people asking for help who cannot afford their insurance.
He said: ‘To be clear, insurance really is essential, especially when it comes to car insurance. People need to be able to drive and people need to be able to drive to look for work, to go to work, to make hospital appointments or to take their children to school.”
Some links in this article may be affiliate links. If you click on it, we may earn a small commission. That helps us fund This Is Money and keep it free to use. We do not write articles to promote products. We do not allow a commercial relationship to compromise our editorial independence.