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Premium Drivers Index - Car Insurance Prices

Every quarter, comparethemarket.com releases research into the latest savings index for car insurance premiums by comparing our ‘cheapest’ and ‘average’ motor premiums across all age groups. The resulting figure can help to give you an idea of how much it would pay off to shop around for your car insurance.

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Car Insurance Savings variable

2016 has seen soaring premiums for us Brits. These graphs show that the cost difference between the cheapest and average premiums has grown to £123 – the highest point since the Premium Drivers index began in September 2012 and another quarterly rise. The savings variable itself has reached 17.2%, up from 17.0% the previous quarter, and representing the fifth successive quarterly rise since Q3 2015. This continued high variable means that there could be opportunities for you to make savings if you compare prices at renewal time.

The average motor premium has risen by nearly £60 year-on-year to £714 in Q4 2016, up from £655 at the same time last year. The cheapest policies have also increased in price, rising £42 from £549 to £591 over the past 12 months. Insurance premiums are at record highs as we’ve seen yet another increase in Insurance Premium Tax – the third since 2014. This has been combined with seasonal price increases that the Premium Drivers index has shown to be typical of this time of the year. We estimate that you could be paying £109 more for your insurance than you did two years ago.

Q3 results

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Postcode lottery

Our latest report has also revealed that your postcode can have a big impact on the cost of owning a car. Unsurprisingly, London is the most expensive place to insure a car, with insurance costing on average £1,460. This is in comparison to the South West where insurance costs less than half at an average of £636. Our research shows that the Kia Sportage is the nation’s most popular car, costing around £13,688 and with an average annual price of just £389 for insurance cover.

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Young Drivers

And, as we’ve seen from our bi-annual Young Drivers Report in August 2016, 17-24 year olds are the hardest hit by this price rise. These drivers pay on average £1257 a year for their car insurance, £543 more than the average for all age groups. But they also have the most to gain from shopping around – they could save around £251 just by switching insurance provider.

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Dan Bass

Head of Motor Insurance

comparethemarket.com

“Even for those who shop around, motoring is a costly business. For those who just auto-renew it’s getting more expensive. The potential saving of £123 for those that shop around shows that insurance companies are relying heavily on people just staying with their old insurance provider and paying more for the privilege. The only way to try to limit these potential price rises is to shop around for the best deal. It only takes a few minutes and could possibly save you hundreds of pounds.”

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Past reports

We carry out this research every quarter to find out what the current landscape means to you when it comes to buying your car insurance. Here you can see our previous Premium drivers’ reports to see how the industry has changed over the past year and what this means for your car insurance premium.

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