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COST OF LIVING

Cost of living in Italy to rise again from September

From the food shop to mortgages, life in Italy is about to cost more from autumn, according to a new study. Here's what will squeeze wallets in September.

Published: 12 August 2023 16:49 CEST
Cost of living in Italy to rise again from September
The cost of living is set to rise in Italy from Autumn. (Photo by MARCO SABADIN / AFP)

As summer in Italy draws to a close, families are set to pay an extra 1,601 euros in living expenses over the coming autumn months.

That’s according to a new study carried out by Italian consumer watchdog Assoutenti.

The research focusses on five items that will further pinch the Italian household budget: food, school, mortgages, petrol and eating out.

“Food costs 10.7 percent more than last year, increasing the expenditure on food and drinks of a typical family in the September-December period by a good 205 euros compared to the same period in 2022,” found the association.

As schools reopen their doors in September, families with school-age children should expect to fork out more for stationery products. These are set to increase by an average of 9.2 per cent year-on-year, due to higher raw material prices and higher production costs.

READ ALSO: EXPLAINED: Why doesn’t Italy have a minimum wage?

This means an increase of 50 euros compared to 2022 for supplies, while books are expected to rise by 45 euros on average.

It will also be more expensive to travel by car. With current fuel prices, the cost of filling up at the pump is forecast to rise in the last four months of 2023 by a total of 103 euros per household.

It’s not good news for those paying a mortgage either.

The European Central Bank has already predicted interest rate increases over the last quarter of the year, putting further strain on mortgage payers.

“Assuming an adjustment of the rates by 0.25 percent in the upcoming meetings of the ECB, the expenditure for the monthly installments in the period September-December would be more expensive overall by about 1,170 euro compared to 2022,” adds Assoutenti.

IN MAPS: How Italy’s property prices vary by region

Today, a variable-rate mortgage with an average of 125,000 euros at 25 years costs an average of 60 per cent more than at the beginning of 2022, with the monthly instalment rising by an average of around 270 euros.

It will also be more expensive to eat out in restaurants and bars. This sector is expected to cost an extra 28 euros per family across the four months.

What about electricity and gas bills? They need to be looked at on their own, according to the association. 

The upturn in demand in the autumn months as the weather turns colder could shake up energy prices on international markets once again, with direct effects on Italians’ bills, warned Assoutenti.

“Italians have to get ready for getting stung by sharp increases in prices and tariffs in various sectors,” said president Furio Truzzi.

To counter these soaring costs, families in Italy will be hoping that the government will follow through on an anti-inflation measure, which could lead to a 10 percent reduction in the food shop, including baby products.

The association indicated that such a measure would translate to savings of around 4 billion euros for Italian families.

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DRIVING

MAP: Where in Italy is car insurance cheapest – and most expensive?

Italy is one of the most expensive countries in Europe when it comes to vehicle insurance – but some parts of the peninsula are far pricier than others.

Published: 10 May 2024 16:08 CEST
Updated: 14 May 2024 09:24 CEST
MAP: Where in Italy is car insurance cheapest - and most expensive?

Car insurance has been in the news in Italy this week following media reports of an emerging insurance evasion tactic that sees growing numbers of Italian motorists dodge steep coverage charges by having their vehicle registered in another EU country, with Poland being the most popular choice. 

The phenomenon, which is estimated to have already led to the presence of over 50,000 foreign-plate vehicles in the country, follows major increases in car insurance costs in recent years, with the average cost of third-party liability insurance (Responsabilita’ Civile or RC in Italian) rising by over 10 percent in the past two years.

But, as consumer groups say these increases are “totally unjustified”, how much does insuring a vehicle currently cost in Italy?

According to the latest available data from Italy’s insurance supervision authority IVASS, the average cost of the compulsory RC coverage – this only covers the costs of damage and injury to other parties – is 395 euros a year. 

For reference, minimum compulsory insurance costs motorists in Germany 304 euros a year on average, whereas drivers in Greece and Poland spend an average of 145 and 120 euros respectively every year, according to data from national auto repair shop association Federcarrozzieri.

READ ALSO: How can you lose your driving licence in Italy?

It’s also worth noting that motorists in Italy often choose to tack on one or more optional insurance policies (these are known as ‘additional guarantees’ or garanzie accessorie) to their basic RC coverage, with additional expenses amounting to somewhere between 400 and 500 euros in some cases.

While there is no publicly available data on how the costs of insurance add-ons vary around the country, IVASS regularly publishes a breakdown of the cost of RC coverage by Italian province.

The latest available report, which refers to data collected in February 2024, shows stark differences in insurance charges around the country, with a 280-euro gap separating the most expensive province (Naples) from the most affordable one (Enna, Sicily).

Besides Naples (569 euros a year on average), the list of ten most expensive Italian provinces for basic RC policies is completed by: Prato (565 euros), Caserta (508), Florence (483), Pistoia (482), Massa-Carrara (480), Lucca (464), Pisa (454), Roma (451) and Genoa (441).

Six of these provinces are located in Tuscany.

READ ALSO: The key vocabulary you’ll need for taking your driving test in Italy

On the other end of the spectrum, Enna (289 euros a year) is followed by: Oristano (297), Potenza (301), Pordenone (312), Vercelli (315), Biella (316), Aosta (316), Campobasso (321), Trento (322), Udine (324) and Gorizia (325).

What’s behind these differences?

The cost of Italy’s RC policy varies depending on the characteristics of the vehicle needing insurance as well as a driver’s personal details, with their location playing a major role in the final bill.

In particular, insurance costs are higher in areas with a high frequency of car accidents (hence why insurance tends to be more expensive in large metropolitan areas than in rural areas) and in areas with high rates of insurance fraud and insurance evasion (an estimated 2.6 million vehicles circulate in the country without the mandatory RC coverage).

Though Giuseppe Conte’s government in 2018 advanced plans to standardise the cost of basic RC insurance and apply the same charge (or tariffa unica) to all motorists around the country, these were later abandoned following consumer groups’ concerns that the new system would ultimately penalise drivers in “the more virtuous provinces”.

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