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Will car insurance go down in 2024?

Sarah Tooze
Written by  Sarah Tooze
5 min read
Updated: 14 Apr 2024

Car insurance premiums have risen by more than a third in the first quarter (Q1) of 2024 compared to the same period in 2023, according to the latest MoneySuperMarket data. Here award-winning motoring journalist Sarah Tooze looks at why car insurance has become so expensive, which age groups have been most affected by price rises, and what you can do to help lower your car insurance.

If you’ve seen the cost of your car insurance jump then you’re not alone. In 2022 the average monthly price for car insurance was £92.48 for a fully comprehensive policy, according to MoneySuperMarket data. In 2023 this rose by more than a third (36.9%) to £126.67.  

Data from the Association of British Insurers (ABI) paints a similar picture. It says that car insurance was 25% more expensive on average across the whole of 2023 than in 2022.  

In the first quarter (Q1) of 2024, our data shows the average monthly premium price was £139.45 - a staggering 67.6% higher than in Q1 2022 when the average was £83.18 and 38.4% higher than Q1 2023 (£100.71).  

Why has car insurance gone up so much?  

Car insurers have been facing a ‘perfect storm’ of issues in recent times: high inflation; parts and labour shortages at garages; a reduced number of courtesy cars due to garages selling them when used car prices were at their peak; more sophisticated technology on new models, particularly electric vehicles (EVs); a lack of information on the repairability of EVs; increased vehicle thefts; and higher new car prices, which makes it more expensive to replace written-off vehicles.  

The ABI believes that repair costs are the biggest factor as they jumped 32% in Q3 2023. It also points to data from Thatcham Research, the motor insurers' automotive research centre, which suggests that EVs are approximately 25% more expensive to repair than their petrol equivalents and take 14% longer to fix.  

The end result is that insurers are spending more on claims and costs than they are collecting in premiums.  

In fact, according to industry analysts EY, the insurance sector has recorded consecutive years of losses, with 2023 recording the highest loss in over a decade.  

Find out more about why car insurance premiums are so expensive.  

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Will car insurance go down in 2024?  

Economic conditions remain difficult and in December 2023 EY forecast that car insurance premiums would rise by 10% in 2024, £58 per policy on average.  

However, more recently, market researcher Consumer Intelligence has suggested there are signs of a ‘possible slowdown’ in quoted motor insurance premiums. In the three months to February 2024 prices increased just 0.5% - the lowest quarterly increase since November 2021.  

Our own MoneySuperMarket data shows that prices have begun falling. In Q1 2024 the average monthly price dropped by 5.4% compared to Q4 2023 (from £147.52 to £139.45).  

On average, drivers in most age groups (30-39, 40-49, 50-59, and 60-plus) saw small reductions. In contrast, the youngest drivers aged 17-22 and 23-29 were quoted higher monthly premium prices in Q1 2024 than Q4 2023.  

It's too soon to say if this is the start of a trend but midway through the year we should have a clearer picture and industry experts predict car insurance premiums will fall ‘properly’ from the middle of 2025. 

Drivers aged 17-22 are the hardest hit by insurance price rises  

The youngest drivers (aged 17-22) have been hardest hit by car insurance price increases. Their average monthly price has more than doubled. In Q1 2022 it was £137.06, now it's an eye-watering £301.56, which equates to more than £3,000 a year.  

Although lots of factors determine a car insurance premium, age is a key metric. Statistically younger drivers are more likely to be involved in accidents than drivers aged 25 or older and are more likely to claim on their insurance, which makes them a higher risk for insurers.  

There are policies available which are aimed specifically at younger drivers and usually require a telematics or ‘black box’ device to be fitted to the car to monitor driving style.  

What you can do to help lower your car insurance 

There are steps which all drivers can take to help reduce the price of their car insurance, such as building your no-claims bonus, driving fewer annual miles, increasing your voluntary excess, tweaking your job title and choosing a car from a lower insurance group.  

It’s also important to shop around for the best deal rather than letting your policy auto-renew. You can compare quotes with MoneySuperMarket by telling us a little about yourself and your driving history.  

We compare quotes from 172 providers1 and you could save up to £5802 on your car insurance.  

1 51% of consumers could save up to £580.23. Consumer Intelligence, December 2023. UK Only. 2 Restrictions and T&Cs apply, click here for details. 3 Accurate as of April 2024. 3 Accurate as of April 2024.