Context
The ABI has published the latest data from its Motor Insurance Premium Tracker for the period July to September 2024, which shows that the average motor insurance premium fell by 2%. This the second consecutive quarter the price of premiums has fallen, following a 2% drop in Q2 2024.
Key points to note and next actions
The ABI’s latest claims data shows:
- Insurers paid out £2.9 billion in motor insurance claims (14% higher than the same reporting period in 2023).
- While the average claim paid remained stable from Q2 2024 to Q3 2024 at a value of £4.8k, it was 8% higher than Q3 2023.
- Repair costs totalled £2 billion for Q3 (26% higher than Q3 2023).
- The average claim for theft of a vehicle dropped in Q3 2024 by 7% compared to Q3 2023. However, the average cost of vehicle theft has increased by 17% to £3k.
2023 was a difficult year for motor insurance margins, with EY estimating that for every £1 collected in premiums, the industry paid out £1.13 in claims and expenses. Over the long term and in real terms, the average premium is 4% cheaper compared to peak prices, while the average cost of a settled claim is 21% more expensive.