Table of Contents
1. EXECUTIVE SUMMARY 1
1.1. The Civil Liability Bill has been delayed to April 2020 1
1.2. Key findings 1
1.3. Critical success factors 1
2. MARKET DYNAMICS 7
2.1. Introduction 7
2.2. The private motor insurance market continued to grow in 2017 7
2.2.1. The private motor market grew by 7.9% to reach £13.1bn in GWP in 2017 7
2.2.2. Non-comprehensive policies are becoming less widespread 8
2.2.3. The Lloyd’s of London market accounts for 1.3% of private motor insurance GWP 8
2.3. Motor insurance premiums have reached an all-time high 9
2.3.1. Motor insurance premiums have continued to rise 9
2.3.2. Comprehensive and non-comprehensive premiums are decreasing 10
2.3.3. IPT has remained at 12% despite concerns 13
2.3.4. The requirement to notify customers of the previous year’s premiums will encourage shopping around 13
2.4. The Ogden rate continues to increase the cost of claims 14
2.4.1. Changes to calculating the Ogden discount rate are set to benefit insurers 14
2.5. The number of motor claims notified fell in 2017 14
2.5.1. Claims notified decreased in 2017 14
2.5.2. Recorded personal injury motor claims fell by over 100,000 in 2017/18 16
2.5.3. Bodily injury claims pose the highest cost for insurers 17
2.6. Whiplash claims remain a problem 19
2.6.1. Whiplash claims were reported to fall in 2017, but remain an issue 19
2.6.2. Motor personal injury claims remain high, while RTA claims are in decline 20
2.6.3. Most RTA casualties are car occupants, but these are the least vulnerable road users 21
2.6.4. The number of pedestrian casualties increased in 2017 21
2.6.5. Car and taxi use has continued to increase 22
2.6.6. The UK motor parc continues to grow 23
3. COMPETITOR DYNAMICS 25
3.1. Direct Line and Aviva hold the largest shares of private motor 25
3.1.1. Direct Line and Aviva currently lead the private motor market 25
3.1.2. Direct Line has been the top private motor insurer for the past two years 26
3.1.3. Aviva offers standard insurance in addition to short-term, learners, and telematics policies 27
3.1.4. Ageas offers four car insurance policies, which can be purchased through brokers 28
3.1.5. LV= and Allianz are in the process of forming a joint venture 29
3.1.6. Mobile network providers are entering the telematics market 29
3.1.7. Chatbots are a new way to get a quote 30
4. THE MARKET GOING FORWARD 31
4.1. The Civil Liability Bill has been delayed to April 2020 31
4.1.1. The implementation of the Civil Liability Bill has been delayed due to Brexit 31
4.1.2. Implementation of the Civil Liability Bill could also depend on future claims trends 31
4.2. The Civil Liability Bill aims to reform personal injury motor claims 32
4.2.1. The Civil Liability Bill seeks to cut claims costs 32
4.2.2. The Civil Liability Bill would save customers £35 on motor insurance premiums 32
4.2.3. The small claims limit will increase to £5,000 for RTA claims 32
4.2.4. A tariff system is being introduced for RTA-related soft tissue injury claims 33
4.2.5. Claims will not be settled without a MedCo medical evidence report 34
4.2.6. There has been a positive reaction to the Civil Liability Bill 34
4.3. New legislation could lead to falling premiums and market GWP 35
4.3.1. The future of the private motor insurance market is uncertain 35
4.3.2. Unless claims costs fall, motor insurance and GWP will remain high 35
4.4. Telematics policies are growing in popularity 36
4.4.1. Technology will take time to penetrate the market 36
4.4.2. The number of young people learning to drive is decreasing 36
4.4.3. There are almost 1 million telematics policies in the UK, but penetration is low 37
4.4.4. Dash-cams are becoming the new telematics 37
4.4.5. Connected cars are the future of providing better insurance services, particularly claims 37
4.5. Driverless cars are expected to become mainstream by 2045 38
4.5.1. The government is supporting the development of driverless cars 38
4.5.2. Motorists with driverless cars will be required to have dual insurance policies 39
4.5.3. Autonomous car manufacturers are entering the insurance market for driverless cars 40
4.5.4. Motor insurers are looking to partner with driverless car manufacturers 40
4.5.5. Insurers could play an important role in reducing the risk of driverless cars 40
4.5.6. The 10 features for a car to be considered automated 41
4.5.7. More than half of new UK cars are sold with autonomous features 42
4.5.8. Electric cars will hold a greater share of the motor parc in the future 43
4.5.9. There will be a divided motor parc as autonomous features gain popularity 44
4.5.10. The need for personal car insurance could diminish 44
4.5.11. Smart roads will make driving safer 44
4.6. Usage-based, car sharing, and P2P policies are being launched 44
4.6.1. The majority of new, innovative policies target millennials 44
4.6.2. Motor insurers are beginning to see the opportunity in car sharing 45
4.6.3. Usage-based pay-as-you-go and pay-per-mile car insurance policies are a growing concept 46
5. APPENDIX 48
5.1. Abbreviations and acronyms 48
5.2. UK Top 20 General Insurance Competitor Analytics methodology 49
5.3. Forecasting methodology 49
5.4. Bibliography 49
5.5. Further reading 54

List of Tables
Table 1: Quarterly change in market average and Shoparound premiums, Q1 2012-Q1 2018 12
Table 2: Number of claims settled, average cost, and gross claims paid by claim type 2013-17 19
Table 3: Market share of the top 10 private motor insurers in the UK, 2016-17 26
Table 4: New tariff amounts for PSLA soft tissue injury claims compared to the 2015 average payment for PSLA, by injury duration 34
Table 5: Charging speeds using 3.7kW, 7kW, and 22kW chargers for electric vehicles, and where they can be found 43

List of Figures
Figure 1: The private motor market has grown, primarily due to rising premiums in 2017 8
Figure 2: Motor insurance premiums reached an all-time high in 2017 9
Figure 3: Premiums for comprehensive policies are beginning to decrease 10
Figure 4: Non-comprehensive policies are also in decline 11
Figure 5: The number of claims notified fell for the second consecutive year in 2017 15
Figure 6: Average claims cost and gross claims paid increased in 2017 16
Figure 7: Personal injury motor claims settled are above pre-LASPO levels 17
Figure 8: Bodily injury claims are the biggest cost despite being less frequent 18
Figure 9: The number of RTAs is in long-term decline 20
Figure 10: The majority of RTA casualties are car occupants 21
Figure 11: Car usage has increased despite petrol prices beginning to rise 22
Figure 12: Brexit caused the value of sterling to drop, causing petrol prices to rise 23
Figure 13: The UK motor parc grew to 31.2 million in 2017, 8.1% of which were newly registered vehicles 24
Figure 14: Direct Line remains the leading provider of private motor insurance 25
Figure 15: Aviva Drive has a dash-cam feature that automatically detects a collision 28
Figure 16: GWP for the private motor insurance market is forecasted to keep increasing 36
Figure 17: There are 10 features that UK insurers believe define an automated vehicle 42
Figure 18: Admiral offers short-term motor insurance policies 46
Figure 19: By Miles will save infrequent drivers money by only charging them for the distance they drive 47
Figure 20: Forecasting methodology 49