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How claiming on car insurance can impact your premium

Find out how much more you’ll pay if you claim

How claiming on car insurance can impact your premium

Claiming on your car insurance could hike your premium by an average of £184, according to new data from Compare the Market.

The price comparison site found that drivers who make claims see their premiums climb to £844, on average, upon renewal, while those with no claims pay £660, on average.

This comes as more people could be submitting claims due to an increase in drivers on the road now that Covid restrictions have been lifted. Compare the Market found that claims surged 39% between last winter (December 2020 to February 2021) and spring (March 2021 to May 2021), as the lockdown was slowly lifted.

On the bright side, this initial rise will typically fall if you don’t submit any further claims. A driver who made a claim between one and two years ago will pay an average of £705.

Here, Which? looks at how different kinds of claims can affect your premium.


Does it cost more if the claim is your fault?

The jump in your premium can vary significantly based on what kind of claim you make.

If you were to blame for an incident, you’d typically face a £742 premium next time you renewed. But if another driver was at fault, it’s £102 cheaper at £640.

For claims when both parties are to blame, you’d actually end up paying more than you would if it was just you – £778 versus £742.

Compare the Market told us that this could be because accidents, where both drivers are at fault, tend to be more serious, making the resulting claims larger. Claims with just one party at fault can be for comparatively minor incidents, such as denting a parked car.

It’s serious claims that make the biggest difference. Drivers who have written off their cars due to an accident in the past five years pay £748, on average, for their insurance.

What happens if your car is stolen?

Premiums can get even more expensive to get insured if your car’s been stolen.

Drivers whose cars have been stolen in the past five years pay £836, on average. That’s £175 higher than a driver without any claims, or £58 more than a claim where two parties are at fault.

You read that correctly: crashing your car through bad driving could potentially be lighter on your premium than getting it stolen when you’re not even behind the wheel.

When asked why this is, Compare the Market offered a few reasons. First, insurers can recoup the costs of cars being written-off when another party is at fault. The cars can also be sold for scrap to recover some of the claim.

Then there’s the location factor. If your car is stolen once, insurers might believe it’s more likely to be stolen again. Perhaps because your area has a high crime rate.

Will the new claims portal make a difference?

All these averages could look a little bit cheaper if the government’s new insurance claims portal has its desired effect.

Last month, the Ministry of Justice (MoJ) launched the Official Injury Claim site to simplify the traffic accident claims process.

It’s also intended to combat ‘crash for cash’ fraud, which sees criminals faking or deliberately causing road accidents in order to claim for whiplash against other drivers.

It’s thought that the new requirement for medical evidence will make this type of fraud more difficult and that new tariffs for compensation will regulate what victims (or fraudsters) can claim.

The government estimates that these new rules will save insurers more than £1bn in payouts, which they are obliged to pass on to customers, working out at a £35 premium reduction per driver.

However, some have criticised the new portal, with the Association of Consumer Support Organisations saying it will primarily save money for insurers, not drivers.

A review of the portal’s success is planned for 2024, so it will be a few years before we see whether it made a difference.

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