Motor insurance premiums are continuing to fall across the UK, but the pace of decline is slowing, reflecting a clear easing in the rate of price reductions.
Average comprehensive premiums fell 9% (£66) year-on-year to £711, according to the latest Confused.com Car Insurance Price Index in association with WTW. While prices remain well below their peak of £995 in December 2023, the latest decrease is smaller than the 13% to 18% annual reductions recorded over the previous five quarters.
The market has now recorded nine consecutive quarters of falling premiums.
More recent data highlights some variation in pricing. While January recorded a 3.2% decrease, premiums rose modestly in both December (0.8%) and February (0.4%).
“The last few months saw modest fluctuations in premiums, but the large scale reductions seen in 2025 appear to have subsided,” said Tim Rourke, UK Head of P&C Pricing, Product, Claims and Underwriting at WTW.
“Looking forward, ripple effects from the Middle East conflict could put upward pressure on UK inflation, owing to supply chain disruption and increased production and energy costs, driving up the cost of motor insurance premiums. However, any rises could be partially offset by a potential reduction in claim frequency if we see a drop in average mileage driven by UK motorists as a result of higher fuel costs.”
Regional data shows that Northern Ireland was the only part of the UK to record an annual increase in premiums for the second consecutive quarter.
Prices in the region rose by 14% (£113) to £947, making it the second most expensive area for motor insurance, ahead of Outer London.
Elsewhere, Manchester and Merseyside recorded the largest annual decrease at 14% (£132), while South Wales saw an 11% (£67) reduction.
South West England remains the cheapest region, with average premiums at £492.
Younger drivers experienced the most significant price decreases, with premiums for 17-year-olds falling by 23% (£517) year-on-year, while 18-year-olds saw a 14% reduction.
However, recent data suggests changes in pricing may not be consistent across all groups.
“While average car insurance prices for new policies have been decreasing for some time and recently hit a three-year low, the pace of these decreases has been slowing. For some demographics, prices have started to increase over the past three months,” said Steve Dukes, CEO at Confused.com.
“As this trend continues, it creates opportunities for responsive, competitive insurers to attract new customers. UK drivers are concerned about the worsening cost of living outlook and so ambitious, agile insurers will look to offer a solution and fuel growth.”
The latest data reflects a continued easing in premiums, but with signs that the pace of reductions is becoming less consistent.
