The cost of car insurance in the UK is slowly starting to fall for the first time in years, new data suggests.
The average motor insurance premium stood at £892 in February, a year-on-year increase of 46 per cent, or £279, according Compare the Market analysis.
But the comparison site said there had been a “month-on-month” decline since November, when prices peaked at £951.
Research from Consumer Intelligence also shows a fall in premiums since December, despite a nearly 60 per cent rise over the prior ten months.
High inflation has bumped up the costs of spare parts, energy and hiring specialist mechanics for repairs, sending premiums to record highs in recent years.
The Association for British Insurers (ABI) estimates motorists paid £100 more on average in 2023 than the prior year, a quarter increase.
However, some insurers have suggested the unprecedented increases may be coming to an end.
The chief executive of FTSE 100-listed Admiral, one of the biggest UK car insurers, said in March that motor insurance prices had peaked.
“There was a lot to recover but I think we are in a very different situation now,” Milena Mondini de Focatiis told the Financial Times, adding that Admiral had even put through a “small price decrease” in the past few months.
Direct Line said last week it would slow the rate by which it increases motor premiums, from 24 per cent last year to 20 per cent in 2024.
Based in New York, Stephen Freeman is a Senior Editor at Trending Insurance News. Previously he has worked for Forbes and The Huffington Post. Steven is a graduate of Risk Management at the University of New York.