​A recent survey conducted by car insurance specialists at Tiger.co.uk has revealed that one-third of British drivers are concerned that escalating car insurance premiums may force them to stop driving altogether.

This apprehension follows a significant 82% surge in quoted insurance prices between May 2021 and June 2024.

​Feeling the squeeze

Despite a slight decrease in premiums towards the end of 2024, costs remain substantially higher than in previous years.

The Association of British Insurers (ABI) reported that the average motor insurance premium fell by 2% in the third quarter of 2024 to £612.

However, this figure was still £50 (9%) higher than the same period in 2023, indicating ongoing financial strain for motorists.

The survey also highlighted that over two-thirds (69%) of drivers have altered their driving habits to manage these rising costs.

Adjustments include reducing mileage, sharing a single vehicle among family members, and limiting car use to social journeys instead of commuting.

​

Paying in to pay out

The persistently high insurance premiums are partly due to record claims costs.

In 2024, insurers paid out an unprecedented £11.7 billion in motor insurance claims, dealing with 2.4 million claims throughout the year.

The average claim paid rose by 13% from the previous year to £4,900, with vehicle repair costs totalling £7.7 billion—a record high and £1.5 billion more than in 2023. ​

Ian Wilson, Managing Director at Tiger.co.uk, describes motorists as “being hammered” by rising costs across the board, adding that it is “leaving many people with no choice but to give up on driving completely, as they are being priced out of the market”.

“While the average cost of car insurance in the UK has started to decrease slightly—a trend which will hopefully continue throughout 2025—the reality is that premiums currently remain significantly higher than they were just a few short years ago. When coupled with the soaring costs of running a car such as road tax, repairs, and servicing, many drivers are being stretched to the limit financially.“​

Looking for change

The ABI has acknowledged these challenges and, in February 2025, launched a 10-point roadmap outlining steps that the industry and government can take to tackle insurance costs.

Progress has been made in areas such as addressing vehicle theft, combating insurance fraud, and assisting consumers in making informed decisions.

However, the ABI emphasises the need for continued collaboration to alleviate the financial burden on motorists.

Resourceful rescues

To mitigate insurance expenses, many drivers are adopting proactive strategies.

The survey found that 80% of respondents now use price comparison sites to shop around for better deals.

Additionally, 77% avoid automatic policy renewals, and 70% switch providers annually in search of more competitive rates.

Enhancing vehicle security by installing trackers, dash cams, or immobilisers and parking in secure locations like garages or driveways are recommended to reduce premiums.​

Despite these efforts, the financial strain remains significant.

According to a report by Confused.com, the average UK premium in the fourth quarter of 2024 was 33% higher compared to two years prior.

Moreover, more than a third (36%) of UK drivers believe their car insurance is more expensive now than it has ever been, with almost one in five (19%) having to dip into savings to cover their policy costs.

Evolving solutions

The insurance industry is also undergoing changes that may impact premiums.

For instance, the adoption of a new Vehicle Risk Rating system aims to account for advanced safety technologies in modern vehicles, potentially reducing insurance costs for cars equipped with such features.

However, the overall effect on premiums remains to be seen. ​

As the UK navigates these challenges, motorists are encouraged to remain vigilant, explore all available options to manage costs, and stay informed about industry developments that may affect their insurance premiums.