General Insurance Article - Covid19 drives down car insurance prices in 2020

MoneySuperMarket releases quarterly research into car insurance policy pricing trends. Average fully comprehensive policy costs down year-on-year by 2% from £486 in Q2 2019 to £475 in Q2 2020

 Prices fall by 6% (£28) from £503 in Q4 2019 to £475 in Q2 2020 for fully comprehensive cover - decrease likely due to reduced vehicle usage under lockdown

 In Q2 2020, East London had the highest premiums in the country (£964) - £688 more expensive than Isle of Lewis (£276), the cheapest location

 Premiums fall year on year by 25% for drivers aged between 17 to 19, down from £1040 to £777

 New research from Britain’s leading price comparison, MoneySuperMarket, reveals the impact of COVID-19 on car insurance premiums over the first half of 2020.

 The cost of an average fully comprehensive car insurance premium in the UK is currently £475 – down 2% from £486 a year ago.

 Despite car insurance premiums peaking towards the end of 2019 at £503, prices have continued on a downward trend in 2020, after road traffic levels dropped by 65% at the height of lockdown, according to figures from the AA. Prices have fallen by £28 between the end of 2019 the end of June 2020 – a fall of 6%.

 Looking at regional variations, drivers living in East London pay most for premiums (£986), almost double the UK average (£486), while London as a whole paid an average premium of £683.

 Drivers in the Shetland Islands experienced the biggest fall in premiums, paying an average of 14.6% (£49) less than 12 months ago. North West London drivers felt the biggest premium rises – cost were up by an average of 7.1% (£59) on last year.

 Looking at age, premiums have fallen substantially by 25% in the past 12 months for drivers aged between 17 and 19, with fully comprehensive cover now costing an average of £777 a year – down from £1040 a year ago. In part, this could be due to a reduction in the number of brand-new drivers in this age group who may have been unable to take their test during the last quarter.

 Drivers aged between 40 and 49, however, saw the average cost of a policy rise by 4% year-on-year to £420 – the largest amount paid by any age group. This compares to drivers aged 65 or over who pay an average of just £282 a year.

 Dave Merrick, car insurance spokesperson for MoneySuperMarket, commented: “Our research shows that it’s likely coronavirus is contributing to the fall in car insurance premiums.

 “With fewer cars on the road, there have been fewer claims, exerting a downward pressure on prices. It’s a pressure that has far outweighed other factors - such as the UK’s departure from the EU - that some expected could have led to premium prices increasing.

 “Quite how long this downward trend will continue is hard to say. As we emerge from lockdown, roads will become busier and claims will start to rise again – which may well lead to prices rising.

 “Whatever happens to premiums in the coming months, if your policy is up for renewal, make sure you shop around for a better deal– doing so can save you up to £270.” 

Back to Index

Similar News to this Story

Christmas Grinch as 12m have decorations stolen or damaged
A quarter of Brits (25 per cent) who celebrate Christmas, some 12.2 million people, claim they have had their decorations damaged or stolen at least o
Ahead of FCA deadline insurers must decide on COVID refunds
Insurers have just a few days left to decide how they need to consider the guidance and where appropriate apply COVID-19 related refunds or discounts
What homeowners plan to use equity release cash for
What people plan to use equity release cash for and what they actually do with the money are not quite in sync, according to SunLife’s new Equity rele

Site Search

Exact   Any  

Latest Actuarial Jobs

Actuarial Login

 Jobseeker    Client
Reminder Logon

APA Sponsors

Actuarial Jobs & News Feeds

Jobs RSS News RSS


Be the first to contribute to our definitive actuarial reference forum. Built by actuaries for actuaries.