"The latest Consumer Intelligence MarketView data shows the average cost of credit on monthly motor insurance payments fell from 10.6% in August 2024 to 9.7% in August 2025, continuing a year-on-year downward trend. Almost half of all active insurers reduced their instalment costs during this period. This fall reflects a wider shift in market behaviour. Several providers have withdrawn or adapted their instalment models, contributing to lower overall averages."
"At the same time, some insurers have introduced simpler ways to spread payments such as using flat monthly surcharges instead of traditional credit agreements which helps to make instalments more accessible and transparent. Together, these changes have helped make monthly payments more affordable for many customers. However, this positive movement on price comes with a note of caution. The proportion of insurers offering a monthly instalment alongside most of their annual quotes has dropped by 11 percentage points year-on-year."
"Michael Dingwall, Insight Analyst at Consumer Intelligence, said: "This is a story of balance. The market is working to make instalments fairer, but also tightening who gets access. Understanding that balance is key to maintaining trust and affordability in motor insurance." As competition and regulation continue to shape how customers pay for cover, understanding these shifts will be key for insurers looking to maintain fairness, trust and commercial balance."
Average cost of credit on monthly motor insurance payments fell from 10.6% in August 2024 to 9.7% in August 2025, continuing a year-on-year decline. Almost half of active insurers reduced instalment costs during that period. Several providers withdrew or adapted instalment models, while others introduced flat monthly surcharges instead of traditional credit agreements to increase accessibility and transparency. The share of insurers offering a monthly instalment alongside most annual quotes dropped by 11 percentage points year-on-year. The market has largely converged on an 11-month payment plan used by about three-quarters of insurers. Competition and regulation are shaping payment approaches and insurer strategies.
Read at London Business News | Londonlovesbusiness.com
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