The UK has seen a steady increase in the number of cars on the road and more importantly, the number of drivers. This is due to an increase in car ownership, which has been fuelled by low car insurance premiums. In the UK, the insurance market is expected to grow by 25%. This is due to an increase in the number of drivers and vehicles on the road.
Understanding UK vehicle insurance
The rise in car ownership has meant that there are now over 25 million vehicles on UK roads. This is expected to reach 33 million by 2035. As this number increases, so does the likelihood of accidents and fatalities.
In order to combat this rising trend, the government introduced new legislation that would see premiums rise for drivers who are considered at-fault for accidents when they have not taken reasonable care or have committed a traffic offence within three years prior to the accident.
This would see premiums increasing by £500 per year (to £5,000) for those driving older cars with high mileage and those who drive high-performance cars but do not have adequate insurance cover or driver training.
Vehicle insurance and the role of government
The government has alsoannounced that it will be introducing a new insurance model for vehicles in the UK in 2022. This new model will be based on how much a vehicle is used, rather than its value. This means that drivers who have older cars and drive less than the average amount of miles per year could see their insurance premiums rise dramatically.
This new model is to help reduce the number of uninsured vehicles in the UK and bring down car-related accidents and fatalities. The government believes that this new law will make driving more affordable for people who are driving less frequently.
In 2022, all new vehicles sold in UK will also need to have a black box fitted and this black box must be able to record data for at least two years before it can be overwritten. This means that insurers must know how fast the car is going, how many miles it has been driven, and what speed limit is being followed at any given time. The black box must also have a GPS tracker which can provide information about where the vehicle was driven and when.
Insurers will also need to know whether the driver of the vehicle is male or female as well as their age and marital status – these are considered important factors that affect premiums for different types of policy.
What changes to expect in UK’s vehicle insurance?
UK car insurance is set to change significantly in the next few years. The government has announced that it will raise the cost of car insurance by around £1,000 per year for the average motorist. This is a result of a number of factors including changes in technology, rising claims and changes in competition.
The UK government has said that this increase will be introduced gradually over a five-year period and it will start with a £100 increase this year, followed by an additional £100 each year until 2022 when the average motorist will pay around £1,200 per year for their vehicle insurance policy.
The UK government is also looking to introduce legislation which would allow insurers to offer discounts for drivers who use cars with newer technology such as autonomous or electric cars and those who don’t drive at night.
This change in policy is likely to have significant effects on how people drive and how they choose their car insurance policy.
