Car insurance not on comparison sites
Direct Line and NFU Mutual are just two of the big car insurers not on comparison sites. So is it worth going direct?
Read more…Car insurance statistics
Is the UK paying too much for car insurance?
Despite car insurance being a legal requirement, some drivers in the UK are choosing not to insure their cars. We have carried out research to find the stats behind car insurance claims, uninsured drivers and the technology that can help to reduce your car insurance cost.
Overview of car insurance in the UK
- £436 is currently the average cost of a car insurance policy in 2022.
- £24 fall in the average insurance policy cost from 2020.
- The average cost of repairing a vehicle under a policyholder’s own motor policy is just over £3,000.
- 23% of those aged 21-29 have a black box installed as part of their insurance policy.
- Over 11 million drivers in the UK recorded using dash cams.
- 79,000 motorists were caught driving illegally without insurance in 2018.
- 47.78% of drivers admitted to doing things while driving that distract from the wheel, meaning there were an estimated 15 million dangerous drivers on the road in 2018.
- 5.82% of men admitted to driving after having a drink or taking medication, compared to just 3.93% of women.
- The average British driver wouldn’t claim for damage costing under £667
- 5% of drivers say they would never claim on their car insurance (1.83 million Brits)
- The most common reason for not claiming was that the cost of the excess would likely exceed the cost of repairs
- Over a fifth of drivers (22%) said they wouldn’t submit a claim because it was too much hassle
- Generation Z would wait until damages reach over £1,000, while the silent generation would claim at £437
- Interestingly, 7% of millennials would never claim on their car insurance
Average cost of car insurance in the UK
The cost of car insurance has been the hot topic of discussion for many UK drivers, with policies seeming to rise year on year. However, since 2017, the average policy cost has actually been decreasing. In fact, in 2020, the average cost of a car insurance policy is currently £460, the lowest level in four years.
£21
Decrease in average insurance policy cost from 2017 to 2020.
Most common types of car insurance claims
Third party claims are the most common in the UK, at 44%. As third party only insurance is the minimum legal requirement for driving a car on UK roads, that is not surprising.
This is closely followed by claims for windscreen damage, which is less expected, considering windscreen cover is often an added extra to many car insurance policies, and not included as standard.
Own damage and fire bring up the rear in claims, which might indicate that people are less likely to claim for damage to their own car as they are for damaging someone else’s vehicle.
What impacts car insurance prices?
Insurance prices have fluctuated since ABI records began in 2010 – but what impacts prices? We explored some of the possible reasons.
Age
The amount Brits are paying for car insurance varies massively depending on age. Explore the graphic below to find out more.
| Age | Average price per month |
|---|---|
| 18-20 | £973 |
| 21-30 | £599 |
| 31-40 | £432 |
| 41-50 | £364 |
| 51-60 | £325 |
| 61-70 | £272 |
| 71-80 | £298 |
| 81-90 | £437 |
| 90+ | £546 |
Drivers aged 20 and under pay the most, with their car insurance costing £374 more than the next highest age group. Those in their 60’s pay the least for car insurance, at £272 a year on average.
Insurance premium tax
One factor that can be identified as affecting the cost of motor insurance is insurance premium tax.
The government first introduced this tax in the early 90s, mostly to make up for the fact VAT does not apply to the insurance industry. While this is supposed to be a tax on insurers, the extra cost is usually passed on to customers through higher premiums.
Insurance premium tax has increased significantly over the years, as indicated in the table below.
| Year | Insurance Premium Tax |
|---|---|
| 1993 | 2.50% |
| 1997 | 4% |
| 1999 | 5% |
| 2011 | 6% |
| 2015 | 9.50% |
| 2016 | 10% |
| 2017 - Present | 12% |
Some types of car insurance are subject to the higher tax rate of 20%, including insurance for vehicles used for people with disabilities and policies taken out with a car dealership when buying a new car.
How many uninsured drivers are on the roads
Motor insurance companies all have to contribute towards the Motor Insurance Bureau scheme which compensates individuals injured by uninsured or untraceable drivers. This is ultimately paid for out of insurance premiums. So how many drivers are driving illegally?
- As of 2020, more than 2 million cars have been seized by Motor Insurers’ Bureau (MIB) since 2005
- 79,000 drivers were caught driving without insurance in 2018
- A 33% reduction compared to 2017, where 118,000 drivers were caught
- 872 of these offences in 2018 were committed by individuals under 17 years of age
| Year | Number of offences |
|---|---|
| 2012 | 108,616 |
| 2013 | 108,486 |
| 2014 | 102,417 |
| 2015 | 92,804 |
| 2016 | 113,502 |
| 2017 | 118,698 |
| 2018 | 79,713 |
How many drivers use dash cams
Dash cams are becoming increasingly popular amongst drivers in the UK. These handy little dashboard-mounted cameras record the road ahead and can prove very useful if you’re ever caught up in an accident.
- Over 11 million drivers use dash cams in the UK
- 27% of drivers are using dash cams in the UK
- 72% of drivers believe all drivers should use a dash cam
- Some insurance companies may even offer a discount if you have a dash cam fitted
Black box insurance
Telematics or black box insurance is a type of policy that calculates your insurance premium based on your driving performance. This is measured by a GPS box fitted in your vehicle that reports on your performance behind the wheel.
These policies have become much more popular in recent years as they typically offer cheaper premiums, sometimes in return for certain driving restrictions (such as total mileage or time of day).
| Age group | Percentage |
|---|---|
| 17 | 13% |
| 18 | 18% |
| 19-20 | 23% |
| 21-29 | 26% |
| 30-49 | 13% |
| 50+ | 8% |
Car accident claims in the UK
The average British driver wouldn’t claim for damage costing under £667, according to our survey research. Over 1 in 10 drivers (11%) wouldn’t claim for anything under £1,000 and this includes 2% who would pay up to £5,000 worth of damages themselves. At the other end of the scale, almost 8% would claim for any damages worth up to £100 and 2% of these would claim for any damages, no matter how small the cost of repair.
95% of drivers say they would claim on their insurance if necessary, but 1.83 million drivers (5%) say they would never claim despite having to pay for it every year as a legal requirement in the UK. The most common reason for not claiming was that drivers thought the cost of the excess would likely exceed the cost of repairs, with 51% of drivers listing this as their reason to not claim. Following this, drivers were concerned that claiming would increase their premiums in the future (46%). Meanwhile, under a quarter of drivers (22%) said they wouldn’t submit a claim because it was too much hassle.
| My excess would likely outweigh the potential cost of repair | 51% |
|---|---|
| I would be worried that my premium may increase in the future | 46% |
| I wouldn't want to lose my no-claims bonus | 44% |
| Hassle e.g. submitting evidence, finding an approved repairer | 22% |
| I would always claim on my car insurance, no matter the amount | 10% |
Sources
- Aviva
- Insurance Post
- Money Advice Service
- RAC
- ABI
Click here for more research. For all media enquiries, please contact:
Matt Mckenna
UK Communications Manager
T: +44 20 8191 8806
UK Communications Manager
T: +44 20 8191 8806
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