Car insurance prices may rise for 10 million drivers – are you most at risk of cost hike?

Car insurance policies may increase by around £20 for many drivers who will need to add a commuting policy to their agreement. Research by Compare the Market has revealed 61 percent of drivers expect to commute by car to their jobs even after restrictions have been fully eased.  


  • Car insurance customers may be paying £200 more than some motorists

This is compared to just 34 percent who used their cars to drive to work before the pandemic. 

Analysis by the group has calculated that an extra 10.5 million drivers may use their cars instead of public transport services. 

However many of these drivers will not be covered to use their vehicles for work purposes under the current agreements. 

Policies will need to be swapped from a Social, Domestic and Pleasure (SDP) agreement to one which covers committing. 

These agreements can often be more expensive meaning millions will face higher charges despite the uncertain financial period. 

Compare the Market says the average motorist may experience up to a six percent increase due to the changes. 

This could push the average policy up from £330 to £350 in £20 rise for the basic policy change. 

Dan Hutson, head of motor insurance at Compare the Market warns the updates could have a “significant hit” on finances. 

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He said: “The Government is encouraging the UK to get back out to work and to society and, crucially, to avoid public transport where possible. 

“Cars are so important for keeping us protected from the virus but, at a time when households are already financially stretched, being asked to drive more could have a significant hit on finances.”

He warned insurance firms may even decide to increase their prices even further as more drivers use their vehicles. 

An increase in commuters using their cars will result in traffic levels increasing which may lead to more crashes than ever before. 


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The increase in overall road risk could force insurance providers to push up costs to keep up with a potential rise in claims. 

Mr Hutson urged motorists to shop around for the most competitive car insurance policy to save money where they could. 

He said: “Motor premiums, which have fallen recently, could be about to jump once more. 

“More drivers will need to adapt their policies to include cover for commuting and insurers may increase their prices in anticipation of more cars, and more crashes on the road. 

“In addition, higher car usage will also result in a higher fuel bill. 

“At a time when money is already tight, it’s important that motorists look to save money where they can and shopping around for the most competitive policy remains the best way to do so.” 

Under guidance from the Association of British Insurers (ABI), key workers who need to travel to a place of work under lockdown do not need to extend their cover to use their vehicles. 

This could mean many motorists do not need to secure a commuting policy just yet until all restrictions have been lifted. 

The ABI guidance says: “If your work is critical to the national response to Covid-19 and you need to use your own car to drive to different locations for work purposes because of the impact of Covid-19, your cover will not be affected. 

“You do not need to contact your insurer to update your documents or extend your cover.”

The Financial Conduct Authority (FCA) has also introduced a range of measures to help those affected financially by the coronavirus pandemic 

They have urged firms to offer payment holidays of up to three months for those that need support while providers should be offering different products to customers who may benefit from changes to their agreements. 

Cancellation and adjustment fees have also been waived across many firms while some have even offered refunds or documents to help those most affected. 

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