Telematics helps drive UK car insurance prices down 9.1%
Car insurance premium cuts are speeding up and have dropped 9.1 percent year on year to an average £766 in the UK with black box technology – so-called telematics – helping to drive the fall in prices, analysis from Consumer Intelligence shows.
Younger drivers have been the biggest winners with premiums falling 15.4 percent year on year but they can still expect to pay average annual premiums of £1,608, according to the research. Across the market, 22 percent of all the top five cheapest quotes came from telematics providers. For under-25s around 60 percent of the most competitive policies are telematics while just 7 percent of the most competitive for over-50s are telematics.
All parts of the country are benefitting with the biggest annual price cuts in the North West at 14.9 percent, research shows. Drivers in London still see the highest annual bills at £1,150 – more than double the lowest at £510 in Scotland.
The cheapest premiums were calculated by comparing the prices offered for 3,600 people by all the major price comparison sites and key direct insurers. The top 5 prices for each person were compared to the previous month’s top 5, then these variations averaged to produce the index.
But overall, premiums are still 20.4 percent higher than in February 2014 when Consumer Intelligence – whose figures are used to calculate official inflation statistics - first started collecting the data.
“The trend in quoted premiums is down which may be partly due to insurers passing on the anticipated benefits of whiplash reforms now,” said John Blevins, Consumer Intelligence pricing expert.
“It’s another sign of the increased competition for business and it is likely premiums will continue to fall unless there are any major shocks in claims or tax rises.
“The influence of telematics is a major factor with increased use of it by the over-50s and a 3 percent rise since March according to our data.
“Generally over-50s experience the biggest price rises as a percentage and the smallest price cuts so older drivers should explore telematics if they want to beat the demographic trend,” Blevins added.
Get all the latest re/insurance industry news with our daily newsletter - sign up here.
More of today's news
Covéa insists on SCOR takeover, CEO temporarily resigns from SCOR board
Chinese insurtech ZhongAn strikes technology deal with Sompo Japan
Rising protectionism to hit marine, trade credit insurance
Munich Re unveils new cyber reinsurance solution for SMEs
Rising interest rates lift insurers’ profitability
