The Independent’s journalism is supported by our readers. When you purchase through links on our site, we may earn commission. Why trust us?
- CAR INSURANCE
- CAR INSURANCE
- TOOLS
- PROVIDERS
- GUIDES
- BROADBAND
- HOME SERVICES
- VPN
- HEALTH
The Independent’s journalism is supported by our readers. When you purchase through links on our site, we may earn commission. Why trust us?
If you’re shocked by the cost of your recent car insurance quotes, you aren’t alone. Bills have rocketed during the cost of living crisis and the average premium is now £776 a year – an increase of 40 per cent over the last 12 months. Get the lowdown on why your car insurance is so expensive and find out what you can do to keep your costs under control.
There are currently a number of economic factors that are making car insurance particularly expensive.
These include:
These economic factors aren’t the only things that drive the cost of your car insurance. There are also a wide range of other considerations insurers will take into account when calculating your premium, which revolve around you, your car and your driving habits.
Although you can’t do anything about the economy, getting to grips with these ‘personal risk factors’ can help you get a better understanding of why your car insurance is so expensive and may help you bring the cost down.
Car insurance personal risk factors:
Car insurance is most expensive for the youngest drivers. According to some estimates, drivers under the age of 20 are now likely to pay more than £2,000 a year for their cover. This compares to £413 a year for the typical 69 year old.
The main reason car insurance is so expensive for young drivers is that they are more likely to be involved in a car accident than more experienced motorists. Claims tend to be bigger too, with younger drivers more often being involved in serious collisions.
According to Brake, one in five drivers crashes within a year of passing their test, while more than 1,500 young drivers will be seriously injured or killed in road accidents each year.
The road safety charity says inexperience means young drivers are less likely to spot hazards on the road. Youth and immaturity can also make some young drivers over confident and more likely to take unnecessary risks like speeding, racing, tailgating and aggressive overtaking.
Insurers typically categorise new drivers as those aged between 17 and 24.
Following the introduction of new rules at the start of 2022, insurance companies can no longer charge customers that are renewing their car insurance more than an equivalent new customer buying an equivalent policy. These are referred to as the General Insurance Pricing Practices (GIPP).
But while existing customers may no longer be paying this ‘loyalty penalty’, it doesn’t mean their car insurance will not be more expensive when they come to renew it.
There are many reasons why your car insurance might become more expensive if you auto-renew with your existing insurer. This could be down to events over the past year or the result of wider economic factors.
Reasons why your car insurance renewal might be more expensive:
Thankfully, there are plenty of things you can do to keep a lid on inflation and cut the cost of your car insurance:
Yes. You will have to declare any driving convictions, from speeding to drink-driving or uninsured driving, to your car insurer. This will unfortunately flag you as a higher risk driver and your car insurance is likely to be more expensive as a result.
You might think new technology is making our cars more secure, but according to the latest figures from the Office for National Statistics, there was a 25 per cent increase in car thefts across England and Wales during 2022, and it’s keyless entry cars that are being targeted.
Keyless cars mean you don’t have to root around in your bag or pockets to get into your car, but while they might be convenient, the new technology has been a gift for thieves. Professional gangs are increasingly using ‘relay technology’ to trick keyless cars’ security systems and can quickly and discreetly steal them from their owners’ drives, often in as little as 60 seconds.
While some thieves still use less subtle methods of stealing older cars, research from insurance company Aviva has found keyless cars are now twice as likely to be stolen than cars that require a key.
If you have a keyless entry car, you can make it harder to steal by storing your key fob in a ‘Faraday pouch’ that blocks its signals. You should also try and store it as far away from your car as you can too.
After growing up with a passion for writing, Molly studied journalism and creative writing at university in her home country of the United States.
She has written for a variety of print and online publications, from small town newspapers to international magazines. Most of her 10-year career since relocating to the UK has been spent in business journalism, writing and editing for admin professionals at PA Life magazine and business travel managers at Business Travel News Europe and representing those titles at conferences around the world.
Now an Editor at the Independent Advisor, Molly is an expert in a broad range of consumer topics, that include solar panels and renewables, home improvements and home insurance, and consumer technology such as home security and VPNs.
In her free time, Molly can usually be found exploring the outdoors with her husband and their young son or gardening.
The Independent Advisor brand is operated by 3S Media International Limited. 3S Media International Ltd is an introducer appointed representative of Moneysupermarket.com Financial Group Limited, which is authorised and regulated by the Financial Conduct Authority (FCA FRN 303190).