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What is the average cost of car insurance?

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If you have a car, you’re going to need car insurance, but finding out the average price of insurance is tricky because not everyone agrees. According to MoneySupermarket (Opens in a new window), the average cost of car insurance in the UK for comprehensive cover was £412 a year at the end of 2021. While this may seem like a lot, car insurance has actually been falling and this is 10.4% lower than it was at the end of 2020. 

What affects the price of your car insurance?

Your age is the most significant thing insurance companies use to give you a car insurance quote. This, along with where you live, the kind of car you drive and other factors, give potential insurers the valuable information about your driving and the likelihood that you will have a crash.

If these factors suggest you’re at a low risk of getting into an accident or getting your car stolen, you’ll get a cheaper quote.

Since quotes can vary significantly based on these factors, it can be difficult to know if you’re offered a fair rate or if you’re being ripped off.

Average cost of car insurance by age

According to Statista*, in 2020 the average cost of car insurance for those in their 20s was the highest out of the age ranges with an average of £851.
 
The lowest average age group for car insurance in the UK was for those in their fifties with the average cost of £468. This doesn’t mean that the older you get, the cheaper your insurance gets though, as the price goes up again once you hit your 60s.

Average car insurance cost by age:

20 year olds: £851

25 year olds: £719

35 year olds: £639

45 year olds: £575

55 year olds: £468

65 year olds: £491

75 year olds: £752


* Source: Figures from Statista These figures are an average of the quotes from a selection of major UK insurers and assume five years’ driving experience and five-year no claims discount.

Average cost of car insurance by gender

We know what you’re thinking - you can’t discriminate based on sex anymore!  Yet male drivers are still paying more on average than female drivers.
 
According to Confused.com male drivers are edging closer to the £600 mark and are paying £574 on average for their car insurance - almost  £100 more than female motorists who are paying £477 on average.

How to keep your car insurance costs low

For years motorists could have suffered a ‘loyalty penalty’ for allowing the policy to auto-renew and staying with the same insurer. However, on 1st January 2022 the FCA’s new rules came into force, meaning that insurance firms must offer existing customers a price that is no higher than they would pay as a new customer. This not only saves you money but also time as you won’t have to shop around and switch every year to avoid paying higher prices for being loyal. 

Of course, you can still compare with other providers, or negotiate with your current provider. In fact, insurance providers must give you straightforward ways to cancel the automatic renewal of your policy. But you will not be charged more at renewal just for being an existing customer. 
 
It’s also worth noting that cheap car insurance is not necessarily the best car insurance for you. But that said, there are things you can do which will lower the odds of you looking like a risky driver in the eyes of insurance companies and get yourself a cheaper deal.
 
We have a guide which has a full list of tricks and tips to get the best deal on your car insurance, but ideas include making your car more secure, drive a make and model car from a low insurance group, be accurate about your mileage, drive safely and add a second driver.

Why is car insurance so expensive?

Unfortunately, many car insurance claims are fraudulent and its honest motorists who end up footing the bill. According the Association of British Insurers the insurance industry detects around 1,250,000 cases a year of fraudulent claims worth a staggering £1.3 billion.
 
Whiplash claims – In May 2021, new rules came into force to address fraudulent whiplash claims. Previously there were on average almost 800 whiplash claims every day in the UK. These claims cost the industry about £1.2 billion a year and insurers have promised to pass these savings on to customers (up to £35 a year). 

Uninsured motorists - There are over one million uninsured motorists on the UK’s roads, which is a problem for many reasons, but also because they ramp up insurance costs for those who do pay. This is because the insurance industry still has to cover the cost of any injury or damage to a person or car in the event of an accident.

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