Context
The ABI has reported that the increased cost of materials and labour continue to push up price of motor insurance in the last quarter. According to the ABI’s Motor Premiums Tracker, the average price of motor insurance reached a record level of £561 year. From July to September, the average price paid for motor insurance increased 9% compared to the second quarter of 2023.
Key points to note
- Following successive quarterly increases in costs, some insurers have reported further Q3 increases of 16% for materials, 15% for labour and 46% for other costs, largely driven by the price of energy.
- In the third quarter of 2023, the average price of £561 represented an increase of 9% on Q2 2023 and 29% compared to the same time last year.
- The ABI is calling on Government to reduce the rate of Insurance Premium Tax (IPT) to help motorists, which makes up £60 of the average premium.
Next actions
None – for information and awareness.