Car insurance premiums in Britain fall 6% in fourth-quarter - survey

FILE PHOTO: Customers are seen looking at cars at Cargiant, following the outbreak of the coronavirus disease (COVID-19), London, Britain, June 1, 2020. REUTERS/Toby Melville

(Reuters) - The cost of a comprehensive motor insurance policy in Britain fell for a fourth straight quarter, with the latest quarter recording a 6% decline, pushed down by coronavirus-led lockdown measures and subsequent claims, a survey showed on Friday.

The average premium for a comprehensive policy is now 763 pounds ($1,041.34), according to the latest index from price comparison site, compiled by insurance advisory company Willis Towers Watson Plc.

The report showed that drivers are now paying 52 pounds lesser than they were 12 months ago, but the rate of decline was slowing.

“The outlook for 2021 remains uncertain,” said Graham Wright, UK Lead of P&C Personal Lines Pricing at Willis Towers Watson.

“Not only are there competing pressures on price from COVID-related impacts on claims experience and actions in advance of the FCA (Financial Conduct Authority) fair pricing rules taking effect, but there are also many other challenges observed throughout 2020 that will persist for insurers into this year.”

In September, the FCA proposed stopping insurers from charging existing car and home insurance customers more than the new ones in its crackdown on the industry.

Lower motor insurance claims during coronavirus-led lockdown restrictions resulted in significantly lower motor insurance claims frequency as customers stayed at home and fewer miles were driven.

The report, based on price figures compiled using anonymous data from all enquiries submitted on Admiral Group’s, said male and female drivers aged 71 or above saw the greatest annual decrease in insurance prices.

Companies such as Admiral, RSA Insurance Group, esure, Direct Line Insurance Group and Hastings Group Holdings are among those who provide motor insurances for Britain’s highly competitive sector.

Reporting by Samantha Machado in Bengaluru; Editing by Amy Caren Daniel