Motor insurance premiums likely to continue rising, say industry experts

Motor insurance premiums are likely to continue rising due to the surge in claims and associated costs, according to industry experts.

According to a report by The Straits Times, insurers in Singapore are facing increasing losses and higher numbers of claims, driving the continued increase in motor insurance premiums. 

The report also highlighted industry statistics from the General Insurance Association (GIA) that showed that in the first three months of 2025, gross written premiums for motor insurance rose by 9.4% to $368.2 million when compared with the same period in 2024. Underwriting losses were also up by about 14% to $13.3 million compared to 2024. 

In 2024, underwriting losses increased significantly to $33.8 million, up from $7.7 million in 2023 and $21.6 million in 2022, and a substantial reversal from the underwriting profits of $49.7 million in 2021 and $104.5 million in 2020. Meanwhile, gross written premiums climbed 11.3% to $1.21 billion for the full year of 2024.

Speaking to The Straits Times, Ms Judy Ng, partner of financial services consulting at KPMG in Singapore highlighted increased accident claims, the growing presence of EVs which can be costlier to repair, as well as global inflation pushing up the cost of vehicle parts, as some of the factors behind the rising cost of premiums.

While Ms Ng noted that premiums could stabilise over time as insurers adjust to higher claims costs, some level of increase can still be anticipated in the future to cater for general claims inflation and other emerging factors. 

It’s also likely that as long as claims stay high and repair costs continue to rise, insurers are expected to say they have little choice but to pass those costs on to the consumers.

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