Why is car insurance so expensive in the UK? | The Independent (2024)

FAQs

Why is car insurance so expensive in the UK? | The Independent? ›

There are currently a number of economic factors that are making car insurance particularly expensive. These include: Insurance premium tax: This is a tax that is charged on general insurance premiums, and it has risen significantly over the years.

A spokesman for Direct Line, one of the UK's biggest insurers, said: “Pricing across the industry has been rising for some time and is mainly due to increased claims inflation and higher repair and labour costs.

Why are car insurance premiums going up so steeply? Repair bills are rising because of shortage of parts and associated price increases, alongside higher garage running costs such as energy bills and wages.

Based on analysis of policies sold, the typical price paid in the first quarter of 2024 was £635, marking a 1% increase on the previous quarter, the ABI said. In the first quarter of 2023, the average premium paid for private comprehensive motor insurance was £478.

You must have motor insurance to drive your vehicle on UK roads. Third party insurance is the legal minimum. This means you're covered if you have an accident causing damage or injury to any other person, vehicle, animal or property. It does not cover any other costs like repair to your own vehicle.

It's also become increasingly more expensive to repair vehicles due to supply chain shortages, mechanic wage increases and additional technologies in vehicles such as microprocessors, cameras and other sensors — all of which contribute to higher vehicle and insurance costs.

Higher insurance premiums for cars and homes are being driven by a mix of factors, including changing regulations, changing human behaviour and a changing climate. Insurers have to balance the need for adequate reserves for claims, maintained profitability and affordable coverage for consumers.

According to Quotezone. co. uk's study, the UK's most expensive region for young drivers to insure their car during January 2024 was London, where motorists aged between 18 to 24 typically paid £2,811.38 per year.

Insurers tend to regard people who only have an automatic licence as less skilled drivers and therefore more of a risk. So they'll charge them more for cover.

Commercial Drivers, Chefs, Hairdressers & Bar Staff Charged The Most For Car Insurance. Being a driver in the hospitality trade means that your car insurance is the most expensive out of the UK's 100 most common job roles.

Can a non UK resident get car insurance in UK? ›

If you're planning to borrow a car from friends or family while you're here, you could get temporary car insurance as a non-UK resident. Short-term policies are available from just one hour up to 30 days.

In the UK, police officers are legally empowered to access your insurance details during a traffic stop or vehicle-related investigation. This authority is rooted in specific legislation aimed at ensuring all drivers comply with the legal requirement to hold a valid insurance policy.

Why might you have a problem getting insurance. Insurers decide the terms and conditions on which to offer insurance cover or whether to offer cover at all. You may have a problem getting insurance if you have a complex medical history, are elderly or have criminal convictions.

Cars are expensive in the UK due to a combination of factors such as higher production costs, Brexit-related tariffs and currency fluctuation. Without an economic reason for dealers to bring down costs, this trend will likely continue.