The average cost of insurance for older cars fell by £87 in 2020 as more drivers kept their existing cars rather than upgrading to a new model according to research from comparethemarket.com.
Cars normally become more expensive to insure as they get older, however, the pandemic has caused a decline in premiums which has offset the usual increase.
In 2020, the average premium for a car that is more than 10 years old declined to £1,521 , from an average of £1,608 in the previous year. In contrast, over the same period, the average premium for new cars increased by £128 to reach £1,212.
More people have chosen to stick with their current vehicles as new car sales have slumped during the pandemic; last year saw the lowest new car sales since 1992 , according to figures from the Society of Motor Manufacturers and Trades (SMMT). As a result, comparethemarket.com research also found that seven in 10cars (69%) on the road are now more than five years old, and nearly four in 10(38%) cars are more than a decade old.
Last year, the most common age for a car on UK roads was four years old, with a typical premium costing £1,066. This is marginally lower than in 2019 when a premium for a four-year-old car would have cost an average of £1,102.
Cars manufactured 36 years ago are typically the most expensive to insure with an average premium of £1,953. Older cars can be more expensive to insure as they are more likely to break down and lack the improved safety features found in newer vehicles. After this peak, average premiums then decline for older cars.
This happens as cars gradually change from being day-to-day vehicles to ‘classic’ cars owned by collectors, which are typically driven less. On average, cars that are 50 years old are £179 cheaper to insure than those which are just 15 years old.