Motor insurance shows signs of slow down
Online motor insurance premiums dipped slightly during quarter four in 2007, the first quarter to see a fall in the average price since 2005, according to research from Experian.
Experian’s Motor Insurance Benchmark revealed a 0.3% fall in the average price for online comprehensive motor insurance during October, November and December in 2007, compared to the previous quarter.
A month-on-month review of 2007 revealed that after an initial increase during the first half of the year, the final 6 months saw the average online comprehensive motor insurance premium become more stable, with the final 3 months recording a slight dip. The year as a whole recorded a 6.3% increase in the average online price compared to 2006.
Over the second half of 2007, the average broker premium increased at a slightly faster rate than online motor insurance premiums. Although online premiums are still higher than in the broker market, the gap is closing fairly quickly.
Avis Easteal, managing director of Experian’s Insurance Services division, said: “It appears that the previously rising online premiums were finally levelling out in the second half of 2007. Broker prices may have remained low in order to compete with online prices, but this can only be sustained for so long and prices started to creep back up in 2007. The last 6 months have revealed a more rapid increase as they attempt to move closer to online levels.
“With the increased chance of road accidents at this time of the year coupled with the problem of uninsured drivers, the average premium will be affected as we move further into the new year.”