A £190 (43%) annual increase means drivers in Scotland are now paying £624, on average, for their car insurance
- Prices have increased across the country, but drivers in Central Scotland are likely to be paying some of the most expensive prices. The average cost in this region is now £691, following an annual increase of £214 (45%).
- Despite the Scottish Highlands and Islands being one of the cheapest regions, drivers in Shetland are seeing their prices increase by almost half. That’s as a 49% (£212) annual increase means prices are now £641, on average.
- But drivers in Glasgow could be facing the most expensive prices overall. A £234 (45%) annual increase means the average price of car insurance is now £757.
- The rapid growth in prices is reflected across other parts of the UK too. According to the latest data, record-breaking figures mean car insurance is one of the highest household bills.
- But drivers are still seeing savings – £63, on average. Louise Thomas, motor expert at Confused.com car insurance shares advice around how driver’s can try to keep costs down at renewal.
The price of car insurance in Scotland has reached record-breaking levels, according to new data.
Drivers are now paying around £624 for their car insurance, an increase of £190 (43%) compared to this time last year. That’s according to the latest (Q2 2023) car insurance price index, powered by WTW.
Based on more than 6 million quotes over the quarter, it’s the most comprehensive car insurance price index for comprehensive policies. According to the data, prices over the last 3 months have also soared too. That’s as the average price has increased by £103 (20%) alone since April this year.
Increases across all regions of Scotland mean that prices are the highest on record since the Confused.com price index began in 2006. Central Scotland is the most expensive, with prices now £691, on average. That’s an increase of £214 (45%) compared to this time 12 months ago.
In the East and North East of Scotland, prices are around £570, following a £171 (43%) rise, on average. Meanwhile, in the Scottish Highlands and Islands, the cost of car insurance is £560, on average.
This follows an annual increase of £166 (42%). And the least expensive region of Scotland is the Scottish Borders. Prices grew by £146 (40%), on average, but drivers were likely to still pay less than others overall. That’s as the average price of car insurance was £512.
Despite being one of the cheapest regions, some drivers in the Highlands and Islands may have had a shock when renewing their car insurance. In Shetland, data shows how prices have increased by almost half.
A 49% increase means that drivers could be paying £212 more, on average, compared to this time last year. That puts the average price at £641. And drivers in Paisley are seeing similar changes. Car insurance prices have increased by £184 (42%) in 12 months, meaning the average price is now £625.
For drivers in Glasgow, they could expect to be paying the highest prices overall. The latest figures show that a 45% (£234) annual increase now puts average prices at £757. The cheapest prices seem to be for drivers in Kirkwall. Despite a 33% (£115) annual increase, prices are around £461. That’s almost half in comparison to the most expensive.
Here’s a full look at the current prices across each region:
*prices are the highest on record
| Central Scotland: | |||
| Area | Average price | Annual increase (£) | Annual increase (%) |
| Edinburgh | £626* | £194 | 45% |
| Glasgow | £757* | £234 | 45% |
| Kilmarnock | £613* | £195 | 47% |
| Motherwell | £699* | £209 | 43% |
| Borders: | |||
| Area | Average price | Annual increase (£) | Annual increase (%) |
| Dumfries | £510* | £139 | 38% |
| Galashiels | £514 | £154 | 43% |
| Highlands and Islands: | |||
| Area | Average price | Annual increase (£) | Annual increase (%) |
| Falkirk | £573* | £172 | 43% |
| Hebrides | £464 | £111 | 31% |
| Inverness | £519* | £155 | 43% |
| Kirkwall | £461* | £115 | 33% |
| Paisley | £625* | £184 | 42% |
| Perth | £524* | £165 | 46% |
| Shetland | £641* | £212 | 49% |
| East and North East: | |||
| Area | Average price | Annual increase (£) | Annual increase (%) |
| Aberdeen | £571* | £174 | 44% |
| Dundee | £587* | £177 | 43% |
| Kirkcaldy | £557* | £164 | 42% |
And other drivers across the UK are seeing similar pricing trends when it comes to their car insurance. According to the data, the UK average now stands at £776. This is an annual increase of £222 (40%) and the highest price ever recorded on the Confused.com price index.
These steep increases mean that drivers across the UK are potentially paying more than ever before. In fact, research by Confused.com showed that the cost of car insurance is almost as high as household electricity and council tax costs. And as a result, makes it the third highest household bill.
That’s according to a survey of 2,000 UK drivers(1), which found that the average council tax bill is now £984 per year, and £964 for energy. And that’s in addition to other expensive essentials, such as food and home entertainment.
That’s as research shows the average UK driver is spending:
- £1,022 on food shopping
- £690 on home entertainment services such as broadband and TV subscriptions.
Are all drivers seeing price increases?
Although some UK drivers saw some savings, most are feeling the effects of these price hikes. While this may look bleak, especially during a financially turbulent time, research also shows that there are savings to be made.
According to the additional research, only 9% of UK drivers had a cheaper renewal price last quarter (April – June). This proves that myths surrounding the regulations implemented by the Financial Conduct Authority in January 2021 aren’t true.
Following the changes, many drivers believed they wouldn‘t get a more expensive renewal price. But as the research proves, this isn’t the case. In fact, almost 2 in 3 (59%) saw their price increase, by £52, on average. This is despite almost a third (31%) having no driving convictions, and a further third (32%) having at least 1 year’s no-claims bonus on their policy.
However, many people trusted that they could find a better price, with almost half (46%) going on to switch providers. Of these, almost 2 in 3 (64%) used a price comparison site and saved £63 on their original price, on average.
It’s a similar picture for those who saw a cheaper price, which averaged at just £34 less than the previous year. Two in 5 (40%) went on to buy with another provider, with 1 in 2 (50%) using a price comparison site and also saved £63, on average.
It seems buying a new car insurance policy right now may sound unaffordable. But figures prove that drivers can still save money compared to the renewal price their current insurer is offering.
Why are prices increasing?
It’s clear from the data that prices are increasing for all drivers, whether they choose to renew or buy a new policy. But why are prices rising so significantly?
One of the biggest expenses for insurers is claims. During the pandemic, fewer cars were on the road. As a result, the industry saw a reasonable drop in prices to reflect the reduction in claims being made. But now, research suggests normal driving habits have resumed. This could mean insurers are having to pay out for more claims than they were 2 years ago.
But the important fact here is that the cost of these claims has increased significantly for insurers. Like with many other businesses, this is arguably down to the shift in inflation rates reported over the past 18 months.
And this, as a result, has driven up the cost of repairs and maintenance, which in the event of a claim, is covered by the insurer. This is especially true for newer cars, and many used cars that are in high demand. In fact, the Association for British Insurers (ABI) reported a 33% uplift in the cost of vehicle repairs last quarter(2).
We’re also seeing that used cars are holding their value more in the current climate. This means that payouts for write-offs or total losses are costing insurers more to cover. Similarly, new cars as well as electric vehicles are much higher in value than before due to more expensive features and upgrades coming as standard. This means paying out to replace a new car is costing insurers more.
How can drivers save money?
With the cost of living crisis continuing to hit Brits in the pocket, it’s clear car insurance is quickly becoming another hefty expense for drivers. It’s no surprise, then, that 2 in 5 (40%) motorists are calling on insurers to do more to make the cost of car insurance more affordable.
In fact, 1 in 4 (25%) claim they’re having to drive less due to the rising costs. And 1 in 5 (20%) are finding the overall cost of driving too difficult to manage. With the average car insurance price now £776, the overall cost of motoring has reached almost £2,000. That’s as research shows the average UK driver is spending an additional £720 on fuel per year, and £455 on other car maintenance costs.
However, according to Confused.com’s fuel price index, the average price of petrol dropped to 143.3p in June, from 174.5p in August last year. Similarly, the price of diesel is just 145.5p compared to an eye-watering 187.1p, which drivers were paying last November. This goes to show that there are still some areas of motoring where drivers are saving money.
But just because car insurance prices are increasing, doesn’t mean that motorists have to pay more than they need to for their policies.
Experts at Confused.com have identified some key ways for drivers to take a few pounds off their insurance price, without making any significant changes to the way they drive:
Be accurate with your mileage – Generally, the more miles you drive, the more likely you are to have an accident and make a claim. This means the higher your mileage, the more you pay for your car insurance. So, driving fewer miles can be a great way to save money on your car insurance policy. But don’t assume that a low mileage always means low prices. If you barely drive at all, your insurance company could see that as a risk as well.
Increase your voluntary excess – Increasing your voluntary excess can help you get cheaper car insurance, but you need to make sure you can afford to pay it, if you need to claim.
Pay for your car insurance annually – If you can afford it, paying for your insurance in one go rather than monthly is one way to get cheaper car insurance. That’s because insurance companies always charge interest for spreading the cost of your cover over the year.
Enhance your car security – The harder it is to steal your car, the less of a risk it is. This usually means cheaper car insurance. There are several ways to improve your car security including:
- Installing a Thatcham-approved car alarm or immobiliser, if it doesn’t already have one
- Adding secondary levels of security like a steering lock.
- Parking overnight in a secure, well-lit car park.
For more advice on how to reduce costs, visit Confused.com’s guide on how to get cheaper car insurance.
Louise Thomas, motor expert at Confused.com car insurance comments, “Car insurance has quickly become one of the biggest expenses for drivers. If prices continue at this rate then there’s no doubt drivers could be priced off the road, as they battle with other rising costs too.
“But what we do know is that many drivers were able to save some money when it came to renewal. And shopping around was the key to this. Even if prices were cheaper for them, the price they saw online was still significantly cheaper.
“Although this isn’t all drivers can do to save money. We always advise drivers to take a look at the details of their policy and make sure they’re accurate before committing to a price. Updating your mileage, or considering additional security could easily bring your price down.
“In the current climate we want to help drivers do all they can to make their insurance more affordable. But we know the key to this will be shopping around and seeing what the best price out there is.
“It’s a competitive industry and we’re confident that switching will result in savings. This is why we offer a guarantee to beat your renewal, or pay you the difference, plus £20(4). In this scenario, you don’t pay more, and you gain more cash!”
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