16 January 2024 , 14:45
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Motor insurance quotes have soared by 67.2% annually, according to the latest index reports.
Consumer Intelligence, the data analysts behind the research, noted a slowdown with premiums increasing by just 10.6% in the three months up to November. The most common quote received by drivers for insurance in November was between £500 and £749.
Based on recent data from the Association of British Insurers (ABI), the average motor insurance cost has increased by 29% or £125 annually in the third quarter of 2023, reaching a record high of £561. Issues such as delays in repair and supply chains, rising parts and materials costs, and more complex car technology were listed by the ABI as reasons for this hike, all adding to insurers' own expenses which then affect the price customers pay for their premiums.
Rising energy bills are also affecting these costs. Max Thompson, an Insurance insight manager at Consumer Intelligence, added: "There is evidence that in certain areas such as Scotland and the East Midlands recent storms have had an impact on premiums. During the last quarter, small increases in telematics competitiveness were observed across all the age groups.. However, motorists across all age groups and all over the country are seeing major increases in quoted premiums."
Jenny Ross, Which? Money editor, shared: "With household budgets under strain during the cost-of-living crisis and car insurance premiums at a record high, many drivers will understandably be feeling apprehensive about renewing their insurance. However, there are ways to find a more affordable deal. It's important not to renew your policy without first checking if you could pay less.
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"The price quoted by your insurer is not necessarily the best price you can get. Doing your research on comparison sites, haggling and switching are effective ways of bringing down premiums."
* An AI tool was used to add an extra layer to the editing process for this story. You can report any errors to [email protected]