UK car insurance premiums dropped 4% in Q2 2025, down 16.4% from two years prior, due to deflation and regulatory issues.

UK motor insurance premiums fell 4% in Q2 2025, down 16.4% from two years ago, amid ongoing deflation. Insurers face challenges pricing electric vehicles due to limited claims data, despite government EV incentives and infrastructure investments. The Financial Conduct Authority uncovered £200 million in underpayments to motorists, triggering widespread compensation. Regulatory scrutiny grows as Which? files a super-complaint over home and travel insurance failures. Industry shifts include leadership changes, MGA growth, and tech adoption, while competition and rising claims costs raise concerns about future profitability.