Car insurance prices during recession

[Chris152]

Does anyone know if they tend to go up or down? Or is car insurance so utterly unpredictable that there's no saying?

Looking for decent quotes for my boy to drive the car he wants and wondering if it'll get better or worse in time, any thoughts appreciated.

C

 

[Just4Fun]

I have no idea of the general trend but a car-related (UK) forum I lurk on has a few posts from people complaining about their renewals being at much higher cost than expected.

 

[Rorschach]

Theoretically they will go down but events are changing so fast who knows.

My provider (Admiral) have told me I am getting a £50 rebate, not seen it yet though.

 

[Phil Pascoe]

My neighbour's lad is delivering for his girl's fast food business. I told him to make sure the boy had commercial insurance and he said apparently the necessity had been suspended because of covid. There are also people on the near empty road driving like idiots. I suspect liabilities on one hand are decreasing a little and on the other increasing a little, so doubt threre's reason to change much either way.

 

[Blockplane]

I have just allowed mine (with RAC) to auto-renew, as the premium had only gone up by £1.80 from the previous year.

 

[u38cg]

I would make sure any kind of assurance like that is in writing from whoever will be paying out. A lot of unpaid claims in car insurance are not due to the insurers being *******s, but due to the policyholder not understanding their coverage.

Generally speaking, almost all the premium you pay is paid out again as claim. If they get it right and they pay out 98%, that's a good year, and if they don't they pay out 102% and it's a bad year (some handwaving due to bank interest etc but that's basically it). So the question is really not "what does X do to premiums", it's "what does X do to claims".

With a recession that's tricky. Probably less driving, but unemployed people are more likely to crash. Emptier roads, so crashes are faster. Less new cars around, so older national fleet, so more accidents due to lack of maintenance. Lots of moving parts.

 

[Rorschach]

My neighbour's lad is delivering for his girl's fast food business. I told him to make sure the boy had commercial insurance and he said apparently the necessity had been suspended because of covid. There are also people on the near empty road driving like idiots. I suspect liabilities on one hand are decreasing a little and on the other increasing a little, so doubt threre's reason to change much either way.

That's interesting, I wonder why they would do that?

I always put down business use on my policy, it costs about £5-10 extra to do it. I am not always certain if I will do any business trips each year but I like to be covered if I do.

 

[Garno]

Probably less driving, but unemployed people are more likely to crash. E

Why are unemployed people more likely to crash than employed people?

 

[Ring]

Chris when my two girls started driving I put either my name or my wife’s on their policy as named drivers and it cut’s the cost of the policy greatly and have done for the last ten years. Hope that helps.


Jim

 

[Rorschach]

Chris when my two girls started driving I put either my name or my wife’s on their policy as named drivers and it cut’s the cost of the policy greatly and have done for the last ten years. Hope that helps.


Jim

Yes that often works for a few years. I added my mother onto mine, it cut £50-100 off each year for about 5 years or so, then it started to increase the price so I stopped. Make sure you check every year if it makes a difference.
Oddly the other way round with my mothers policy, she added me on which cost her about £100 for a few years, now it only costs a tenner to add me.

 

[Phil Pascoe]

One to watch if changing companies is that often now they take off the third party cover for other vehicles without making it obvious. My friend drove his elderly father's car regularly and I told him to ensure he was covered. Oh, I've always been covered for other vehicles, he said. Two weeks later he said I owe you an apology for that one - you were right - I checked, and I wasn't covered.

 

[Chris152]

Thanks for the replies fellas. I know quotes are based on stats, but to one who knows little about the details it's all very unclear. Til recently, we had an 'affordable' quote (about £1400 - yes, that's quite good these days for a new driver) for the car we were looking to buy and now, having found the car, that quote had disappeared and the lowest was about £3.5k, more than double.

I'm also on a car forum where I've been asking people to help me figure out what's going on - the same car, same use and storage registered at a tiny fraction of the insurance cost in one part of the country compared to the quote we got for the same car where we are. The only variable seems to be geography, and there was I thinking we lived in a low-crime area.

I think I've tried all the options with no significant shift in price - the only option now is calling the classic car specialists (it's 30 years old). If prices were likely to drop with a recession, he could go ahead and get provisional licence cover (cheap) and switch once he has his licence (which could be a long, long way off with the present circumstances) and then take out full licence cover. But nothing seems so predictable these days! :?

 

[Rorschach]

Ooof sorry to hear of the troubles.

My first insurance was a few £'s under a grand (3rd party, I couldn't afford fully comp). If it helps after the first year prices drop dramatically, mine dropped probably 30% per year for the first few years, then fully comp got cheaper than 3rd party, but that first year was painful.

It might be worth insuring the car in your name with him as a named driver for the first year or two, that helped some of my friends.

 

[Chris152]

I thought of taking out cover myself (no no-claims, mine's on another vehicle) and having him as a named driver - that was over £3k; for me alone, £86. Bizarre. And it seems now if you search 3rd party, far fewer insurers are offering so it works out more expensive - fully comp brought the price down. Car insurance, beats me!

 

[Phil Pascoe]

It might be worth insuring the car in your name with him as a named driver for the first year or two, that helped some of my friends.

Which, if the boy is the main driver makes it illegal. It's "fronting".

https://www.gocompare.com/car-insurance/guide/fronting/

 

[Blackswanwood]

Chris, you may have already looked at this but if not ... telematics let’s the insurer see how the car is being driven. If your son drives sensibly you pay less ... if he doesn’t it costs more.

Going back to your original question any correlation to motor premiums and the state of the economy is low. The main factors that move motor insurance prices are the cost of claims ... mainly personal injury which jumped significantly a couple of years ago and competition. Unfortunately young male drivers have more accidents which result in more personal injuries than most other identifiable cohorts of the population due to bravado and being egged on with a car full of mates.

The insure it in your own name and get it cheaper is a fallacy. The premium is calculated on the main driver - if you lie about this you risk invalidating the insurance. It also means your son will not start to build up his own no claims bonus although some insurers will take account of a clean driving record on someone else’s insurance and give a discount.

 

[rafezetter]

Theoretically they will go down but events are changing so fast who knows.

My provider (Admiral) have told me I am getting a £50 rebate, not seen it yet though.

really? I'm with Admiral as well, have been for 4 years now and yes each year the renewals go up more than the extra years "no claims discount" is supposed to be - which annoys me, so I tell them... and the price goes down several hundred pounds....

I really do feel for those people who just accept it unquestioningly.

The telematics system..... un-convinced, I had it with Admiral my first year**, drove carefully (I do anyway) speed limits even in the 20 zones, got "gold" level each month for the three months and got a whopping £17.50 rebate on an almost £900 policy.

Yes £17.50, or a 2% rebate - worth it? Not really, although I assume it has the added side effect of reinforcing good driving habits for the first few months of a new driver.

**(2016 - I was 46 - yes I'm a later bloomer, a near fatal RTA and 3 months in hospital age 27 will have that effect)

 

[rafezetter]

Probably less driving, but unemployed people are more likely to crash. E

Why are unemployed people more likely to crash than employed people?

Because employed people generally want to get to work the next day, and the next, and the next - and so on, because they like having more money than you can get on benefits (in most cases).

 

[rafezetter]

Thanks for the replies fellas. I know quotes are based on stats, but to one who knows little about the details it's all very unclear. Til recently, we had an 'affordable' quote (about £1400 - yes, that's quite good these days for a new driver) for the car we were looking to buy and now, having found the car, that quote had disappeared and the lowest was about £3.5k, more than double.

I'm also on a car forum where I've been asking people to help me figure out what's going on - the same car, same use and storage registered at a tiny fraction of the insurance cost in one part of the country compared to the quote we got for the same car where we are. The only variable seems to be geography, and there was I thinking we lived in a low-crime area.

I think I've tried all the options with no significant shift in price - the only option now is calling the classic car specialists (it's 30 years old). If prices were likely to drop with a recession, he could go ahead and get provisional licence cover (cheap) and switch once he has his licence (which could be a long, long way off with the present circumstances) and then take out full licence cover. But nothing seems so predictable these days! :?

Yeah geography and LOCAL geography are factors - I live in Bristol, my mate in Brecon in Wales - we did a test to see how that panned out when I was going to renew insurance a couple of years back after a similar conversation about car insurance prices - Bristol is EXPENSIVE, almost as much as London - which I knew about for cost of general living but was not aware it was applied across the board for other things too. Being in Filton which isn't a "nice" area like Clifton or Henleaze, doesn't help, although not as bad as Southmead or Knowle West.

 

[RogerS]

I thought of taking out cover myself (no no-claims, mine's on another vehicle) and having him as a named driver - that was over £3k; for me alone, £86. Bizarre. And it seems now if you search 3rd party, far fewer insurers are offering so it works out more expensive - fully comp brought the price down. Car insurance, beats me!

Have you tried clearing the cookies relating to companies giving your quotes? If the insurance companies behave like airlines (I see no reason why not) then they will manipulate the quotes.

The downside of putting the car in your name is that your son won't build up (hopefully) his own no-claims bonus.

Telematics ? Any better ?