Average premiums lower than they were in 2017, despite slight rise in Q4

The cost of motor insurance fell in 2018, according to the latest data from the Association of British Insurers’ (ABI) Motor Premium Tracker.

This is the first annual fall for four years, with the last coming in 2014.

The average price paid for motor insurance in 2018 was £477, down 1% from 2017, when it was £481.

Quarterly rise

Premiums did, however, start to rise again in Q4 of 2018.

Premiums in Q4 stood at £479, up 2% on the three months before. The ABI says this is the smallest Q3 to Q4 rise since 2013. It also says that a rise in Q4 is expected as it goes with the seasonal trend.

The ABI attributed the slight rise to lower car sales, with insurers’ fixed costs needing to be spread across fewer motor polices.

Civil Liabilty Act is “crucial”

Mark Shepherd, assistant director, head of general insurance policy at the ABI said customers could welcome the news after years of increasing premiums.

He said: “This annual fall is good news for millions of UK drivers after a few years of rising premiums, that reflected, in part, rising vehicle repair costs, a weaker pound, and uncertainty around the reform of personal injury compensation.”

Shepherd also took this opportunity to reiterite his desire for the Civil Liability Act to be implemented fully.

“Implementing the provisions of the Civil Liability Act will be crucial to delivering a fairer compensation system for claimants and continued competitive premiums for motorists,” he said.

”Despite reports suggesting premiums are going up, what we actually saw was an overall fall in the average motor premium paid in 2018, with the seasonal rise in quarter four premiums lower than normal.”