Motor insurance payouts remain at record £3.2bn

Motor insurers paid out £3.2bn to support road users in Q3 2026, the same as Q2’s record figure and 8% higher than the same period last year.

This is according to the ABI’s latest motor insurance premium tracker, which revealed that the average claim cost in Q3 was £4,900 – a 1% increase year-on-year.

The ABI said this highlights ongoing cost pressures facing insurers. It also noted that the average claim for replacing or repairing a windscreen was £298 this quarter, up 5% from Q2 and 9% year-on-year. 

Chris Bose, director of general insurance and international policy at the ABI, said: “With more than £3bn paid out last quarter, matching the previous quarter’s record, insurers continue to play a vital role in helping drivers, passengers and road users recover when things go wrong.” 

Falling premiums

Despite increasing costs, the average motor insurance premium sat at £562 in Q3 2026, which was £4 lower than the previous quarter. 

This figure is £11 (2%) higher than the same period in 2025, but down £7 year-on-year when adjusted for inflation.

Bose added: “While competitive premiums are welcome news for customers, persistently high claims costs are putting significant pressure on insurers.

”Bringing these costs down is a key aim of the government’s motor insurance taskforce and is crucial to ensuring a sustainable and competitive market for consumers in the long-term. We’ll work with government, insurers and the wider sector as the taskforce’s recommendations are implemented and this collaborative approach remains essential.”