Record £9.9bn paid out in motor insurance claims last year, says ABI
Payouts for repairs, thefts and replacement vehicles increased, the Association of British Insurers said.
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Your support makes all the difference.Motor insurers paid out a record amount in claims last year, according to the Association of British Insurers (ABI).
The £9.9 billion paid out in 2023 is the highest annual figure since the ABI started collecting data in 2013.
The total was up by 18% on the £8.4 billion paid in 2022.
The overall number of claims settled, at 2.3 million, also rose by 10% compared with 2022.
The cost of vehicle repairs at £6.1 billion jumped by 31% compared with 2022.
This reflected continued rising costs, with insurers reporting increases for materials, and labour, the ABI said.
It added that garages also faced rises in their energy costs during 2023.
Payouts for vehicle theft and thefts from vehicles also jumped, to £669 million.
This total, and the average theft of a vehicle claim of £12,600, were both the highest on the ABI’s records.
The cost of providing temporary replacement vehicles, at £597 million, increased by 35% compared with 2022.
This represented another annual record since this data has been collected.
Significant and sustained cost pressures faced by insurers, such as a 31% rise in repair costs over the last year, have impacted on the cost of cover
As part of the overall payout figure, insurers paid out £2.4 billion in personal injury claims, a figure which was down by 8% on the previous year’s total of £2.6 billion.
Higher costs have also impacted the price of cover paid by motorists, with the average price paid for motor insurance in 2023 put at £543 by the ABI, 25% more expensive than in 2022.
The ABI recently published details of actions that could be taken to tackle motor insurance costs.
These included making more data available for consumers to understand which vehicles are more expensive to insure.
Jonathan Fong, the ABI’s manager, general insurance policy, said: “Significant and sustained cost pressures faced by insurers, such as a 31% rise in repair costs over the last year, have impacted on the cost of cover.
“Despite this, insurers continue to do all they can to ensure competitively priced motor insurance.”