British motor insurers, already struggling with high costs and tougher environmental rules, now face a drop premium rates due to the decline in accidents and claims.
According to a report by Reuters the average premium for a comprehensive motor policy in UK is now £770 ($972) based on the latest index from price comparison website www.Confused.com.
The compilation carried out by Willis Towers Watson Plc found the cost of a comprehensive motor insurance policy in Britain was down by 5% in the second quarter (April-June 2020), the largest quarterly drop since early 2018. Coronavirus-led uncertainty has also clouded future claims and pricing trends for motor insurers.
Willis Towers Watson UK lead of P&C personal lines Graham Wright said, “As we emerge from lockdown and roads become busier, insurers are attempting to predict claims and adjust prices before the full impact of COVID-19 on both medium and long-term frequency and severity trends is known.”
Registration of new cars in Britain also fell by 35% in June on a year-on-year basis, the smallest drop since February, as many dealerships reopened after coronavirus-led lockdown measures were lifted.
Britain’s Financial Conduct Authority in an effort to support car finance and high cost credit customers, has granted borrowers and users the chance to freeze or reduce repayments on their debts for a further three months.