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Restore and provide points placing strain on worth of motor insurance coverage, says ABI



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he common worth paid for motor insurance coverage fell to a six-year low in 2021, however price pressures on the business are beginning to chew, in accordance with the Affiliation of British Insurers (ABI).

The typical worth paid final yr for complete cowl was £434 – marking a 7% fall in contrast with 2020 and the bottom worth since 2015.

However the ABI highlighted the rising price of repairs to broken automobiles and provide chain points which have triggered delays in accessing some alternative elements.

With highway visitors returning to pre-coronavirus lockdown ranges, the variety of claims can be anticipated to extend.

The ABI’s tracker appears on the worth customers pay for his or her cowl, slightly than the worth they’re quoted.

Whereas we count on the motor insurance coverage market to stay extremely aggressive in 2022, rising prices for elements, repairs and different provides and companies will proceed to place strain on premiums for motor insurance coverage for each new and present prospects

The most recent figures had been launched at a time when family payments equivalent to power prices are surging and a few households face dipping into their financial savings or borrowing extra to keep up their dwelling requirements.

A pricing shake-up was launched by the Monetary Conduct Authority (FCA) from January 1, which implies motorists not pay a loyalty penalty for sticking with their supplier yr after yr.

But it surely might result in some prospects who’ve beforehand benefited from large reductions by procuring round paying greater costs than they might have carried out earlier than the pricing shake-up.

Laura Hughes, the ABI’s supervisor, common insurance coverage, mentioned: “Whereas we count on the motor insurance coverage market to stay extremely aggressive in 2022, rising prices for elements, repairs and different provides and companies will proceed to place strain on premiums for motor insurance coverage for each new and present prospects.

Insurers recognize that many households are dealing with a cost-of-living squeeze with rising family payments as prices rise in different areas of the financial system, and they are going to be doing all they will to make sure competitively-priced motor insurance coverage, within the face of the number of price pressures confronted.



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