Admiral car insurance loses thousands of customers
Reported by BBC News, Car insurer Admiral has lost thousands of customers on the back of steep price rises which means motorists are paying more than ever for insurance.
The British insurer said profits had risen 4% to almost £234m despite losing 380,000 customers over the last year.
Its boss Milena Mondini de Focatiis said: "We recognise that these are challenging times for many people."
Admiral hiked prices by 20% during the first half of the year in response to high inflation and repair costs.
Matt Britzman, equity analyst at Hargreaves Lansdown, said: "The bad news for consumers is that car insurance is now another inflated cost to try and manage as part of the ever-increasing pressures on income.
"Some customers have had enough, and Admiral saw a 7% dip in customer numbers year-on-year. But for Admiral, that's a loss worth taking as maintaining profitable insurance contracts is key, even if it means losing a few customers along the way."
According to an analysis of 28 million policies by the Association of British Insurers (ABI), the average premium across the industry in the three months to the end of June was £511 - 21% higher than the same period last year.
The ABI said sustained cost pressures were behind the record highs, with higher energy costs adding £71.75 to each repair.
Paint and material costs have increased by nearly 16%, with the average price of second-hand cars rising 19%, it found.
Mervyn Skeet, the ABI's director of general insurance policy, said: "These continue to be tough times for many motorists and motor insurers alike. With many families facing higher cost of living bills, no-one wants to see the cost of their motor insurance rise.
"Insurers remain determined to ensure that motor insurance remains as competitively priced as possible, but this has become increasingly challenging, given the continued rising costs that they are facing."
In June, a report found that 2022 was the UK motor insurance market's worst performing year in a decade and that for every £1 motor insurers received in premiums, they paid out £1.10 in claims and costs.
Mr Britzman said Admiral had been increasing its prices ahead of its competitors but now the rest of the market had caught up, which should help "soften the number of customers leaving the firm".
Our sister company Vint-tro has reported that many of it's clients who were Admiral customers had seen prices almost double, forcing them to start shopping around. Fortunately for many of those customers, Vint-tro Cover was able to help with lower premiums.
Admiral's shares were up more than 5% during morning trading.