Dan Hutson, Head of Motor Insurance

Ofgem's research on Evs - May 2021

“Demand for electric and hybrid cars has surged in the past year. The good news for these drivers is that savings on fuel, tax and car insurance costs will help to offset the higher upfront price of their electric vehicles. Our latest figures show that electric cars were typically £87 cheaper to insure in April compared with petrol or diesel alternatives. The difference in the cost of insurance between the vehicle types has also widened recently: electric premiums have fallen 3% month on month, while petrol and diesel premiums have increased 5%.

“It is encouraging that Ofgem is planning investment to support the electrification of vehicles. ‘Range anxiety’, or fear about finding a charging point, remains one of the key issues preventing many drivers from making the switch. Further improvements in charging technology and increasing the availability of charging points will be needed to reassure motorists about electric vehicles ahead of the 2030 ban on new petrol and diesel car sales.”

Government accouncement on automated lane keeping systems - April 2021

“Allowing hands-free driving of cars fitted with Automated Lane Keeping Systems on motorways is a huge leap forward on the journey to introducing self-driving cars in the UK. At the moment, the considerations for insuring so-called ‘driverless cars’ are still being worked through, but it’s thought that artificial intelligence could help to make cars safer and reduce the number of accidents in the long term.

“Avoidable accidents account for around 94% of all claims and it’s thought that reducing human error will lead to fewer accidents. Therefore, although self-driving cars may initially be more expensive to purchase and insure, if the number of accidents declines then that could also lead to lower insurance premiums.”

ABI annoucement on working from home during COVID19 - April 2021

“As a result of the pandemic, some people who used to drive as part of their commute to work may now be considering working more at home. If you decide to drive less often due to new work arrangements, you can speak to your insurer to request a refund or mid-term adjustment which could save you money. For instance, premiums can be cheaper if you are insured for a lower mileage or your car is kept in the garage at home during the day, rather than the office car park.

“As offices reopen and lockdown restrictions lift, some people may also plan to use their car more often and need to speak to their insurer to increase their estimated mileage. It’s worth letting your insurer know about any changes in your usual driving habits to make sure you are still covered by your policy.”

Car location trackers - March 2021

“Installing a location tracker can help to keep your car secure and significantly improve the chances that your vehicle will be recovered if it is stolen. These devices usually need to be professionally installed with an upfront cost and sometimes a monthly or annual fee. Having a tracker could help to bring the cost of your car insurance down, and for some high-risk vehicles, insurers will insist that you have an approved tracking device installed in order to offer cover. However, currently only a small percentage of our customers who enquire about insurance say that they have a tracker installed on their vehicle since they are often only used in expensive cars. If you’re considering having a tracker installed, it’s worth speaking to your insurer to see how this could impact your insurance.”

Government cut to EV subsidies - March 2021

“The cost of buying electric cars remains the steepest hurdle to their adoption, so many will be disappointed by the Government’s decision to cut the grants available to those who want to switch.

“Electric cars only represent a small proportion of the total car market, but sales have accelerated even during the pandemic. As a result, we’ve seen a number of manufacturers pledging to phase out petrol and diesel car production well ahead of the Government’s 2030 deadline.

“Our research shows that on average electric cars can be nearly £90 cheaper to insure than the average for petrol and diesel cars. This saving - along with lower fuel and tax costs - should hopefully provide financial incentives for drivers to choose an electric model when they're buying a new car.”

ABI Premiums - January 2021

“With fewer cars on the road last year due to lockdowns, working from home and social distancing, premiums have fallen to their lowest level in years. This is welcome news for most households as budgets continue to be stretched. However, these savings are usually only available to drivers who shop around for the best deal at the end of their policy, with our research showing the difference between the average premium and the cheapest premium to be £104.”