Insurance: inflation eases slightly, but prices continue their steep ascent

While the rate at which insurance premiums are rising has slowed a bit, don’t let that fool you—prices are still steep. 

Over the past year to June, premiums have gone up by 14.0%, down from the 16.4% increase we saw in March 2024 according to the latest ABS Consumer Price Index (CPI).

Yet, despite this slowdown, the increase remains significantly above average inflation.

The culprits behind these persistently high costs? According to the CPI, it’s the usual suspects: higher reinsurance costs and more frequent natural disasters. These factors continue to push up premiums for everything from your car to your home insurance.

Reinsurance—what insurance companies use to protect themselves against large losses—gets pricier as disasters become more common and severe. This in turn affects what we end up paying. 

Simply put, as the environment changes and extreme weather events become more routine, the financial impact trickles - or should we say floods (no pun intended) - down to consumers.

Will the trend continue?

Last month, we reported that S&P Global predicted that insurance inflation would ease throughout 2024 and 2025. Does Junes minor dip mean they could be right? 

Only time will tell of course. But for now, the best we can do is hope the trend continues, and to ensure you’re doing everything in your power to bring your own premiums down. One way to do that is to compare options and see if you can find a better deal elsewhere.

Here are a few attractive options: