The UK motor insurance market is projected to return to profitability in 2024, with a forecasted Net Combined Ratio (NCR) of 93%, recovering from a record loss of 112.7% in 2023.
High claims, alongside material and labour costs, and premium rates falling below inflation led to particularly challenging years for UK motor insurers in 2022 and 2023.
Consumers can expect a 12% rise in premiums in 2024, averaging an extra £68 per policy, as firms adjust to inflationary pressures despite forecasts of a slight decline in 2025.
Despite initial signs of recovery in 2024, the UK motor insurance sector anticipates returning to loss-making status in 2025, with an expected NCR of 101.6%.
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