Is Car Insurance Increasing During Covid and What May Happen Post-Covid?

Car insurance is a reality of life that is necessary when you own a vehicle. While you may currently be in lockdown and only taking occasional trips to pick up shopping from the supermarket, it’s still necessary to keep the vehicle insured at all times.

Is car insurance increasing in cost during the Covid period? And what’s to be expected after Covid is finally resolved? In this article, we consider both of these to give drivers a good idea of what to expect now and in the future.

Maintain Your Insurance

It might be tempting to let your car insurance lapse if you aren’t using the vehicle at all, but it’s only legal to do that if you apply for a Statutory Off-Road Notice (SORN ).

Letting insurance lapse and then getting out on the road to a doctor’s appointment or to purchase some groceries could result in a heft fine and a criminal record. Unless you do apply for a SORN your car insurance must be maintained and current during the Covid period and post-Covid. Nothing has changed in that regard.

Are Insurance Premiums Increasing During Covid?

When it comes to car insurance across the UK and NI too, the story is similar. This is because, despite different laws being enacted and lockdown restrictions put in place, most government bodies across the UK are putting similar limitations or constraints in place.

Claims have gone down during the various lockdowns, as fewer drivers are on the road, but some insurance companies are still hiking their renewal prices. Comparison sites like Compare NI continue to help motorists find cheaper policies during these difficult times, so if your renewal quote has come through it is good to check the price for your car insurance NI online.

Younger Drivers Aged 19 and Below

For younger drivers who are a little less vulnerable to the more serious symptoms of a Covid infection, their insurance premiums have often either stayed the same or declined.

Ultimately, premiums reflect the relative risk of getting into an accident. With younger, inexperienced drivers who sometimes drive faster than is necessary, the accident rate is noticeably higher. However, with far fewer cars on the road and speeds often a little reduced to address pedestrians crossing the road more often, fewer accidents are happening presently.

As a result, policies coming up for renewal may not see price increases or possibly may be reduced in cost.

Older Drivers

For older drivers, whether the over 30s or pensionable age, have been a mixed picture when either securing a new car insurance policy or renewing one.

It’s fair to say that there’s more risk to a policyholder of catching Covid and being affected by it. Unfortunately, this can happen without even knowing that they’ve caught the virus or are being impacted by it.

Typical insurance premiums for people above 30 have either stayed flat or increased a few percentage points over the previous year. The increase, if any, hasn’t been significant because most people quarantined do stay home and if their condition worsens, they will call an ambulance service. Therefore, they’re usually not behind the wheel once their condition has been accurately diagnosed.

Will Insurance Premiums Increase Post-Covid?

This now gets into more conjecture rather than facts.

It looks likely that Covid will continue for this year and likely into the next too. For instance, most tourism-related businesses aren’t expecting much uptick this year. The vaccination program is ongoing in NI and throughout the UK. However, available dosages aren’t always predictable including the post-Brexit hassle dealing with continental Europe. With the oldest part of the population and other more vulnerable people being vaccinated first, it will require many months to vaccinate a significant proportion of the population.

Accident Rate Will Initially Be Less Predictable

When it comes to typical car insurance prices, the picture will likely be a mixed one. Certainly, there will be millions of drivers who are now out of practice with driving – especially on busy roads once again – who will be more prone to driving errors (or that of others ). Therefore, the rate of accidents is likely to increase above both Covid and pre-Covid times.

Younger Drivers May See Premiums Temporarily Increase

Furthermore, for younger drivers, their rate of accidents will noticeably increase and therefore, their premiums are likely to be more costly compared to during Covid when they may have declined. Therefore, it’s a good idea for younger drivers to set aside what they might be saving on insurance premiums this year to cover a short-term increase above the norm post-Covid.

With all that said, we don’t have a crystal ball! It remains to be seen how people continue to deal with Covid and if they drive more safely. The future is never certain. We may be surprised by careful driving when people gingerly get behind the wheel during normal living conditions again. Also, many people could continue to work from home. In which case, the reduced road usage may cut into the accident rate and materially alter insurance premiums in a post-Covid world.

We’ll just have to wait and see.


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