The cost of private car insurance premiums soars in the final quarter of 2015
19th January 2016
The latest Insurance Price Index from the British Insurance Brokers’ Association (BIBA) and Acturis that tracks £5billion of actual premiums paid annually via insurance brokers shows a significant rise in the level of premiums charged for private car policies.
In the final quarter of 2015 annual premiums for car insurance rose by 8.6% compared to premiums paid in the same period of 2014. The bad news worsens for motorists if you take into account that a 58% increase in Insurance Premium Tax (IPT) came into effect on 1 November 2015 and so drives the actual cost of motor policies up by over 12%.
Steve White, CEO at BIBA said: “BIBA has said many times that IPT is a tax on protection and affects the affordability of insurance. The motor insurance industry has worked hard to tackle fraud to help minimise rises in premiums so it is particularly worrying to see such a significant increase fuelled further by the IPT rise especially in a period when we are seeing the number of uninsured drivers rising.”
The Insurance Price Index also examines premium developments of three typical ‘insurance baskets’ for ‘Larger Commercial’, ‘SME’ and ‘Individual’ tracking percentage changes in premium for these groups of buyers.
Theo Duchen, Co-CEO of the Acturis Group added: “The individual insurance basket which tracks private car and personal household premiums has shown decreases in annual average premiums since the end of 2012, but the latest figures confirm that they are now levelling off and indeed comparatively grew in quarter 4 2015 compared to the same quarter last year.”
Steve White concluded; “BIBA’s 2016 Manifesto calls for ‘fairness for all’ including fairer premiums for customers, who all find themselves paying for fraud and uninsured driving, and we are committing to working with other industry stakeholders to reduce both.”
- ENDS –
- The BIBA-Acturis insurance premium index results: Q4 2015 compared to Q4 2014
Individual basket: +1.9%
Motor insurance: +8.6%
Home insurance: -4.8%
SME basket: -0.5%
Commercial vehicle: -0.1%
Commercial package: -1.0%
Larger commercial basket: -0.5
Commercial combined: -1.7%
Commercial liability: +1.7%
- 2. For further information please contact BIBA press office:
Pam Quinn, Communications Manager
020 7397 0223
- About the British Insurance Brokers’ Association
The British Insurance Brokers’ Association (BIBA) is the UK’s leading general insurance intermediary organisation representing the interests of insurance brokers, intermediaries and their customers.
BIBA membership includes just under 2,000 regulated firms having merged with the Institute of Insurance Brokers (IIB) in November 2011.
General insurance brokers contribute 1% of GDP to the UK economy and BIBA brokers employ more than 100,000 staff.
54% of all general insurance is sold by an insurance broker and they arrange 79% of all commercial insurance business.
Insurance brokers put the client’s interests first, providing advice, access to suitable insurance protection and risk management.