’Motor insurers continue to deliver when motorists and personal injury claimants need them the most,’ says manager general insurance
Motor insurance pay-outs from insurance firms rose by 29% in Q2 to reach a total of £2.5bn, outpacing the average growth in motor premiums recorded across the quarter, new figures have revealed.
The ABI’s data, published yesterday (5 September 2023), noted that the jump in motor insurance payouts was the highest recorded since the ABI first started to collect data in 2013 – equivalent to motor insurers paying out £28m every day in the quarter.
This increase also represented a 3% quarter-on-quarter increase on Q1’s figures and a year-on-year rise of 29% on the £2bn total motor pay-outs made in Q2 2022.
Over the same period, average motor premiums for customers increased by 21%, according to the ABI’s Motor Insurance Premium Tracker.
The latest Motor Insurance Premium Tracker – which tracks average prices paid – highlighted that the average premium paid by UK customers currently sat at £511.
Rate of inflation
The news followed after consultancy firm Ernst and Young (EY) said that, were motor insurers to make the necessary adjustments to premium prices and keep pace with the rate of inflation, the market should return to a profitable net combined ratio of 97.4% next year.
Read: Briefing – Dominoes tottering as falling motor market margins cause exits
Explore more motor-related content here or discover other news stories here
Richard Reed, head of UK general insurance at EY, warned earlier this year (26 June 2023) that ”the need for the sector to address this and rebalance its books unfortunately means that consumers will face a sharp rise in their premiums”.
“2023 will undoubtedly be tough for consumers and insurers alike, but we expect these challenges to ease once inflation falls back,” he said.
Laura Hughes, the ABI’s manager for general nsurance, added: “Motor insurers continue to deliver when motorists and personal injury claimants need them the most.
“Despite facing sustained cost pressures, motor insurers remain totally focused on supporting customers when the worst happens and doing all they can to ensure competitively priced motor insurance.
“With many families facing higher cost of living bills, anyone concerned about being able to afford their insurance should speak to their motor insurer to see what options might be available.
“Despite cost pressures, it can still pay to shop around to get the policy that best meets your needs at the most competitive price.”
No comments yet