The latest General Insurance Price Index from Pearson Ham Group indicates that motor insurance premiums in the UK continued to fall in April 2025, though the pace of decline has slowed compared to previous months.
The data shows an average monthly decrease of 0.8%, the smallest reduction recorded over the past year. This brings the annual decrease to 16.9%, with the median top-five quoted premium now at £467.
Pearson Ham Group noted that while overall premiums continue to decline, variations across age groups and regions have emerged. Motorists aged 31–40 and 51–60 saw the largest reductions, averaging around 1% in April.
In contrast, premiums for drivers under 26 and over 70 remained largely unchanged. This shift suggests insurers are refining pricing strategies based on more granular demographic risk segmentation.
Earlier figures from the third quarter of 2024 revealed a consistent downward trend in motor premiums, with Pearson Ham Group’s October 2024 index showing a 4.4% drop in competitive prices.
August recorded the sharpest single-month decrease at 1.9%. The third quarter marked the second consecutive quarter of declining prices, amounting to a total reduction of 9.6% over a six-month span.
Notably, September 2024 also saw year-over-year deflation for the first time, with premiums 8.5% lower than the same month in 2023.
Regionally, the North East and North West recorded the most significant annual decreases at 18.5% and 18.7%, respectively. Other areas such as Yorkshire & the Humber, the East of England, and the East Midlands also experienced monthly movements of 1% or more.
The price index also shows diverging trends based on vehicle value. Vehicles valued between £10,000 and £20,000 recorded a 1% decrease in premiums during April, while vehicles at lower price points experienced a marginal reduction of 0.2%. Pearson Ham Group attributed this difference to possible shifts in underwriting appetite or claims cost expectations by vehicle class.
Stephen Kennedy (pictured above), director at Pearson Ham Group, said motor insurance pricing continues to soften but with growing divergence across segments.
“The sharp falls of recent months are slowing, and this may be the early signal of a market beginning to stabilise,” Kennedy said. “As always, the direction of travel will be influenced by claims experience, repair cost inflation, and competitive dynamics in the months ahead. Insurers will need to remain agile and closely tuned in to these diverging pricing signals.”
On the home insurance side, the report shows premiums also edged downward, though at a slower rate. April saw a monthly decline of 0.4%, bringing the annual reduction to 4%. The median top-five quoted premium fell to £212. However, data suggests the pace of change is moderating in several parts of the market.
Pearson Ham Group’s analysis found differences based on property type and size. Flats experienced the steepest monthly drop at 0.7%, while detached homes saw the largest year-on-year reduction at 5%.
Premiums for large homes with five or more bedrooms remained flat in April, contrasting with declines seen in smaller properties. Homes with zero to one bedroom saw a 0.5% drop, suggesting mid-sized properties continue to drive overall downward movement.
Regionally, the South East reported the largest premium reduction at 0.6%, while other regions experienced decreases in the range of 0.3% to 0.5%.
Frances Luery, product manager at Pearson Ham Group, said home insurance pricing is trending downward but showing signs of slowing.
“The data points to a more nuanced landscape, where premium movements differ by property size, type and region,” Luery said. “It’s particularly interesting to see large homes holding steady while other categories continue to fall. This reflects how insurers are fine-tuning their pricing strategies based on evolving risk and cost dynamics. As ever, market competition, weather-related claims, and inflationary pressures will shape where pricing goes next.”
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