Monthly column: Motorists have never had it so bad

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Car compound for scrap metal recycling viewed from above image Richard Johnson:AdobeStock
A car compound for scrap metal recycling. Image: Richard Johnson/AdobeStock

The Conservative Government claims to be on the side of the drivers but whether it’s the rising price of petrol or soaring car tax and insurance costs, the cost of driving has sky-rocketed while road maintenance has plummeted.

The price of car insurance almost doubled between early 2021 and the end of 2023.

The latest Confused.com car insurance price index reveals car insurance now costs £941, on average with more than 2 in 5 (43%) UK drivers claiming they are paying more for their insurance now than ever before, even on cheaper or second-hand cars.

Young drivers are almost priced out of the market with the 17-year-olds paying around £3,000, over triple the national average.
Even drivers who have built up a healthy no-claims bonus are paying more.

It is estimated that over a million people cancelled their car insurance in 2022 because of cost-of-living pressures. Unfair postcode pricing – “a poverty premium” is also leading to higher costs.

A 2023 Citizens Advice survey of 15,000 people found that people from ethnic minorities were charged 40% on average more than white people, even where differences in pricing go beyond typical risk factors of crime rate, deprivation, road traffic accidents and population density.

The level of price increase in the UK has far outstripped that of the EU, where prices increased around 10% between the beginning of 2021 and the end of 2023.

So why is this happening and what can we do about it?

Auto Express took a deep dive into what the trade magazine described as the broken UK car insurance market and found multiple points of failure.

  • Rampant recent inflation fuelled increases in the retail price of new and used cars
  • Uninsurable electric cars exported by Chinese manufacturers with insufficient spare parts backup and critical repair information
  • Workshop repair costs are driven up by technology and the skills shortages
  • Hugely expensive EV batteries that can’t be economically repaired after the slightest external damage an
  • rampant levels of car theft are treated as a ‘no victim’ insurance issue by police forces who don’t take action.

Labour will bring back community policing to help tackle car crime and ensure our Apprenticeships levy and Skills offering ensure the skills base is there to fix new cars.

The UK insurance industry needs to take a much tougher stance on any brands that don’t provide effective parts and information support. Car manufacturers also need to create battery exchanges so EVs can be repaired quickly and cheaply to prevent write-offs.

Labour will crack down on unfair insurance costs by consulting with the industry on ways to crack down on unfair practices from insurers, such as a lack of transparency over autorenewals, the rise of hidden fees, and the poor value of insurance products.

We will look to mandating car insurance providers to offer clear alternatives to policies that auto-renew, giving consumers a right to choose the policy best for them (existing FCA guidance already suggests clear explanations of the impact of auto-renewal for vulnerable customers).

By taking steps to tackle unfair practices and hidden fees, Labour’s plan could save drivers hundreds of pounds per year by allowing them to choose the insurance policy that is right for them.

This is a monthly guest column provided by
Mohammad Yasin, Labour MP for Bedford & Kempston.
It is published unedited and does not
reflect the views of the Bedford Independent.