26 February 2024
Increasing insurance premiums – what are the causes?
We’ve been contacted by lots of you recently about spiralling insurance premiums – both for motor and household – and how they’re affecting you.
We’re aware of this issue and how it’s affecting Islanders, as it is yet another cost-of-living increase for consumers to contend with.
This isn't just a Jersey situation though, it's UK-wide, with premiums increasing across the board since 2022.
In January 2022, the UK’s Financial Conduct Authority (FCA) introduced some new rules to stop insurers offering better deals to new customers. While this is good for those customers sticking with their ongoing policy, the rules don’t stop or cap the rise in policy costs, so in that respect it’s not good at all.
As a result, many Islanders have seen big increases in their premiums this year. Unfortunately, without a cap on the level of premium paid, the price of cover will fluctuate to reflect a range of factors, such as inflation, building costs, and setting claims due to storms, floods, and the like.
The average premium for comprehensive cover on a motor vehicle in the UK has gone up by 58% from this time in 2022, according to Which? Magazine's March 2024 edition.
In Jersey, your driver profile will include factors such as your age and your driving record, which influences what you pay for car insurance.
Younger drivers have been hit more than most, with those aged under 24 being forced to pay out for premiums into the thousands in some cases.
These premium increases will be affected by rising car repair costs. And disaster-related claims are also a significant reason why car insurance rates are surging for many drivers.
We're not sure what the answer is. All we can advise is to keep shopping around, try to haggle where you can, and look out for tips using national consumer news organisations such as Which? magazine and Money Saving Expert. Their pages relate to the UK, but you can often pick up tips that are relevant to use in Jersey.
You can also check out some of our recent stories on insurance:
Which motor insurance providers currently provide cover in Jersey? (consumercouncil.je)
Home Insurance (consumercouncil.je)
Car Insurance (consumercouncil.je)