Motor insurance prices have now fallen on average by £284 (29%) since prices peaked at
£995 in December 2023, with prices having decreased for nine consecutive quarters. However, when compared to annual price falls ranging from 13% to 18% recorded during the previous five quarters, the latest 9% decrease indicates the rate of price deflation is slowing.
While offset by a decrease of 3.2% in January, average prices during the last three months actually saw modest rises in both December (0.8%) and February (0.4%), according to the UK’s longest established and most comprehensive car insurance price index.
Tim Rourke, UK Head of P&C Pricing, Product, Claims and Underwriting at WTW, said: “The last few months saw modest fluctuations in premiums, but the large scale reductions seen in 2025 appear to have subsided. Looking forward, ripple effects from the Middle East conflict could put upward pressure on UK inflation, owing to supply chain disruption and increased production and energy costs, driving up the cost of motor insurance premiums. However, any rises could be partially offset by a potential reduction in claim frequency if we see a drop in average mileage driven by UK motorists as a result of higher fuel costs.”
Source: WTW / Confused.com Car Insurance Price Index. *Average values rounded to the nearest whole number.
Northern Ireland continues to buck the wider national trend by being the only region to experience an annual rise in prices for the second quarter in a row. Premiums for drivers in Northern Ireland increased dramatically by £113 (14%), from £834 to £947. Northern Ireland now ranks as the second most expensive region in the UK for car insurance, for the first time pushing Outer London into third place.
Drivers in Manchester / Merseyside benefited from the steepest price reductions, with an annual dip of 14% (£132), reducing their premiums from £936 to £804. Drivers in South Wales saw the next biggest percentage drop of 11% (£67), with their premiums decreasing from £614 to £547 during the same period.
Of the regions to experience a reduction, the smallest were seen in Scotland, where drivers saw more modest annual falls ranging from 2% to 4%. South West England remains the cheapest region for car insurance, where average premiums dipped below £500 and now cost £492, with Central and North Wales following close behind at £502.
Source: WTW / Confused.com Car Insurance Price Index. *Average values rounded to nearest whole number.
More locally focused data shows motorists in the Manchester / Merseyside postcode area of Warrington benefited from the biggest annual fall in car insurance premiums, where prices dropped by over 15%. Drivers in the Cheshire town saw premiums decrease from £745 to
£630. West Central London, still the country’s most expensive postcode, saw an annual fall of 6% (£81), with average premiums now at £1,349 compared to £1,430 in February 2025.
Llandrindod Wells in Wales continues to be the cheapest town in the UK with prices on average now costing £438, where prices fell by 4% compared to 12 months ago. Drivers in Shrewsbury now also enjoy average premiums less than £500 for the first time in three years after an annual fall of 6% reduced their premiums to £484, joining Swansea (£498) and the South West towns of Torquay (£476), Truro (£495), Exeter (£474) and Dorchester (£474) in the ‘sub-£500 club’.
Younger drivers continued to benefit from the steepest price falls. Drivers aged 17 experienced the greatest price falls compared to other age groups, benefiting from a significant 23% annual price decrease, reducing their average premiums by £517 from
£2,258 to £1,741. Drivers aged 18 saw the next biggest reduction in annual prices of 14%, taking their average premiums to £2,082.
Steve Dukes, CEO at Confused.com, comments: “While average car insurance prices for new policies have been decreasing for some time and recently hit a three-year low, the pace of these decreases has been slowing. For some demographics, prices have started to increase over the past three months.”
“As this trend continues, it creates opportunities for responsive, competitive insurers to attract new customers. UK drivers are concerned about the worsening cost of living outlook and so ambitious, agile insurers will look to offer a solution and fuel growth.”
1 This latest quarterly data release by the WTW/Confused Car Insurance price Index covers the three-month period December 2025 to February 2026.
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