The cost of car insurance has increased by 46% year on year, according to new Premium Drivers research from Compare the Market. The typical premium stands at £892 in February 2024, after rising by £279 over the previous 12 months.
The substantial increase in the cost of car insurance may in part be due to a rise in the cost of claims for insurers. Previously high inflation rates will have likely impacted many areas of the motor repair industry, including the cost of spare parts, energy, and hiring specialist mechanics. However, there has been a month-on-month decline in the cost of car insurance since November 2023 when the price peaked at £951.
Young drivers, aged under 25, have seen the largest annual increase in the cost of car insurance. The typical premium for motorists in this age group has risen by £648 year-on-year to £2,057 in February 2024.
Compare the Market: Cost of car insurance by driver’s age (YoY)
Motorists looking to cut the cost of car insurance should consider shopping around for a cheaper deal when their policy comes up for renewal. Drivers could save up to £578 on their car insurance through Compare the Market.
Julie Daniels, motor insurance expert at Compare the Market, comments: “The rising cost of car insurance is understandably causing concern for many motorists. Our research shows motor premiums have jumped by more than £250 year-on-year. For those concerned about the cost of driving, shopping around ahead of renewal is one of the best ways to save money on car insurance. We want to encourage motorists who tend more to stick with their existing insurer each year to compare prices to find the right deal for them.”
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