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Home Premiums Up Sharply While Motor Stalls In Q1

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According to the AA, home insurance premiums have increased sharply over the past three months, while motor premiums have stalled.

The AA’s benchmark British Insurance Premium Index shows that premiums for the average quoted shop around premium (average of the five cheapest quotes for each ‘customer’ in a nationwide basket of risk) jumped by 5.4% for the three months to 31 March to £114.52.

That compares with a rise of 6.7% over the last quarter of 2015 which was largely attributable to the increase in Insurance Premium Tax which took effect from 1 November.

Over 12 months, buildings premiums rose by 12.3%, contents fell by 1.2% and combined was up by 2.8%.

Meanwhile, motor premiums slipped back slightly in the first quarter, the first quarterly fall for a year. Average quoted premiums fell £2.43 to £561.24, or 0.4%, compared with an increase of 10.1% over the previous quarter.

The AA said the first quarter often sees insurers pricing competitively to build market share at a time when, with the new motor registrations, more policies are sold.

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