Has car insurance gone up in 2024?

The cost of car insurance has fallen annually for the first time in almost 3 years. The national premium is now £861, a decrease of £63 in the past 12 months.

Prices have dropped quarter-by-quarter since the beginning of the year, this follows 2 years of continuous increases every 3 months. It represents a significant U-turn in pricing trends, offering respite to UK drivers.

Have car insurance costs gone up?

No, car insurance prices have actually fallen by 7% compared to this time last year, on average. This means drivers in the UK can now expect to pay £861 on average for their car insurance policy. Premiums have been steadily declining since the end of 2023 where prices had reached almost £1,000 - a UK record.

Despite this, some drivers are still met with a higher price from their insurer on renewal. In a survey of 2,000 UK drivers, nearly 2 in 3 (60%) received a quote £84 more expensive than their existing policy, on average.

Why has car insurance gone up?

Drivers may find policies cheaper now compared to last year, but premiums are still high across the board. Despite prices falling as of late, nearly 2 in 5 (38%) say their insurance is more expensive now than it has ever been. Further research found that 1 in 5 (19%) motorists consider their car insurance to be one of their biggest expenses.

There are several reasons why car insurance premiums are still relatively high.

Inflation has seen the cost of parts and labour soar, in turn it's costing insurers more to pay to repair or replace vehicles. As newer cars adopt advanced technology and equipment, it's more complicated to repair and replace certain components.

It's always worth shopping around. Even if your renewal isn't as high as expected, or is only slightly less than the previous year, you could still save money by comparing quotes.

How have car insurance prices changed over the past few years?

The costs of car insurance began to rise during 2019. The COVID-19 pandemic helped to keep premiums in check as driving habits began to shift with less cars on the road.

Since then, more people have returned to the roads, coupled with the cost of living crisis. This has caused car insurance costs to climb, but we are beginning to see a gradual decline as of late.

Male drivers pay more than women

The cost of car insurance premiums is falling for both genders, but men still pay more. Male drivers now pay an average premium of £920, down 7% (£67) from last year. Female drivers can expect to pay £762, a 7% decrease (£58) year-on-year.

The EU Gender Directive means insurers can't set prices based on gender. However, other risk factors come into play. Men often drive more expensive cars, which leads to higher claims. They also tend to have more motoring convictions.

These factors contribute to the £158 gap in car insurance costs between men and women. Shopping around can help you find a better deal, regardless of gender.

Younger drivers hardest hit

Young drivers pay significantly more for car insurance than older, more experienced drivers. 17-year-olds were the only age group to see their premiums increase (4%) from last year, an average of £2,727.

Meanwhile, 18-year-olds pay the most of any age group - an average of £2,886, a 4% decrease compared to last year.

When will the cost of car insurance go down?

According to our Q3 2024 research, car insurance costs only dip below the £1,000 mark when drivers reach the age of 36. At this age, the average premium is £999. This is a slight change as in Q3 2023, prices fell below £1,000 at the age of 39.

While car insurance costs are significantly more expensive for young drivers, there are still ways to reduce what you pay!

• Shop around before your renewal to find the best deal
• Pay annually for your insurance, if you can
• Increase your voluntary excess
• Build up a no-claims bonus

For more tips, take a look at our guide on how to get cheaper car insurance.

Other costs still high

The cost of fuel is falling, offering encouragement to UK drivers. But fuel aside, the cost of driving is still increasing. According to our fuel price index, fuel prices rose between August 2021 and July 2022 before starting to come down again.

Fuel costs have swiftly fallen since the start of May. Petrol now costs £1.34 per litre, and diesel costs £1.39, on average (prices correct as of 10 October 2024).

What our motor insurance expert says

“After a long period of seeing their car insurance increase, the news of prices starting to come down will be a relief to drivers. It’s the respite we’ve all been waiting for.

“However, prices are still a lot higher than they have been historically. Many of us will still be paying more than we have in the past, despite gaining more driving experience or building up our no-claims bonus. This is why it’s so important to keep shopping around and to make changes to our driving habits if we can. We could also change how we use our cars to see if we could bring our price down even further."

Rhydian Jones Commercial Director & Motoring Expert