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United Kingdom (UK) Private Motor Insurance Market Analysis and Forecast to 2025

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  • 46 Pages
  • November 2021
  • Region: United Kingdom
  • GlobalData
  • ID: 5517894
Gross written premiums in the UK private motor insurance market declined in 2020. This was caused by a fall in both the average cost of premiums and the total number of policies written. The number of vehicles on the roads in 2020 fell significantly on the previous year as national lockdowns and other national restrictions, introduced to curb the spread of COVID-19, kept consumers at home for long periods of the year, reducing traffic, collisions, and claims. The Civil Liability Act is expected to reduce bodily injury claims, which should push premiums down. The demand for usage-based insurance products continues to grow, and insurers must react to this change in the market to remain competitive. Going forward, the market is expected to recover slowly, a result of reduced mobility in the short term, maintaining a low level of road accidents and claims for now, which will maintain lower premium prices than before the pandemic.

This report analyzes UK private motor insurance, looking at market size as well as changes in premiums, claims, road casualties, the motor parc, regulations, and future opportunities. It discusses the impact of COVID-19 on driving behavior and the further implications related to claims. It also looks at the leading competitors and how the market is likely to change due to telematics and driverless cars, as well as providing future forecasts of market size up to 2025.


  • Average premiums fell to £465, compared to £472 in 2019.
  • Direct Line remains the market leader, while Allianz is now the second biggest player after completing its acquisition of LV=.
  • The cost of personal injury remains the biggest claim cost to insurers at an average of £12,009 per claim and a total cost of over £3bn to the industry.
  • Road traffic accidents fell heavily in 2020, as did total claims, a result of the two national lockdowns in 2020.

Reasons to Buy

  • Determine the underlying factors affecting the private motor market.
  • Understand the impact of new regulations in the industry.
  • Observe the actions and reactions of incumbent market leaders and insurtech newcomers.
  • Recognize the changes in consumer and provider behavior as the market begins to emerge from the COVID-19 pandemic.
  • Anticipate new challenges and changes to the market going forward.

Table of Contents

1. Executive Summary
1.1 Market overview
1.2 Key findings
1.3 Critical success factors
2. Market Dynamics
2.1 The private motor insurance market contracted again in 2020
2.2 Factors influencing premiums in 2020
2.3 The motor claims landscape in 2020
2.4 RTAs and their link to claims
3. Competitor Dynamics
3.1 Direct Line remains the market leader for motor insurance
3.2 Analysis of the market leaders
3.3 Newcomers and insurtechs gain traction
4. The Market Going Forward
4.1 Sluggish recovery in the private motor insurance market
4.2 The Civil Liability Act will reform personal injury motor claims
4.3 Other factors will also contribute to a rise in premiums
4.4 Future opportunities in usage-based, car sharing, and P2P policies
4.5 Technology continues to reshape the motor insurance landscape
4.6 Connected cars, the Internet of Things, and smart motorways
4.7 The shift towards electric vehicles presents a challenge to insurers
4.8 Fully autonomous vehicles will disrupt the motor insurance landscape
5. Appendix
5.1 Abbreviations and acronyms
5.2 Methodology
5.3 Secondary sources
5.4 Further reading
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List of Tables
Table 1: Number of claims settled, average cost, and gross claims paid, by claim type, 2016-20
Table 2: GWP and market share of the top 10 private motor insurers in the UK, 2018-20
List of Figures
Figure 1: The private motor insurance industry declined in 2020
Figure 2: Average premiums have generally fallen since the start of the COVID-19 pandemic
Figure 3: There was a huge decline in claims notified and claims frequency in 2020
Figure 4: Average claim costs continue to rise
Figure 5: Bodily injury claims are the most expensive claim for insurers
Figure 6: The number of road casualties in 2020 is artificially low
Figure 7: Casualty numbers fell for all passenger types in 2020
Figure 8: Car and taxi road traffic fell to a 25-year low in 2020
Figure 9: The price of petrol dropped to 104.7 pence per liter in the first national lockdown
Figure 10: New car registrations fell 27.9% in 2020
Figure 11: The majority of consumers expect to drive fewer miles after the pandemic
Figure 12: Direct Line remains the market leader in the private motor market
Figure 13: The UK private motor insurance industry is expected to reach £14.2bn by 2025
Figure 14: Forecasting methodology

Companies Mentioned (Partial List)

A selection of companies mentioned in this report includes, but is not limited to:

  • Direct Line
  • Aviva
  • Admiral
  • Ageas
  • LV=
  • Advantage
  • Munich Re
  • esure
  • AXA
  • Covea
  • By Miles
  • Tesla
  • Marmalade
  • Marshmallow
  • Vitality
  • Abacai
  • Carrot