Are car premiums on the way down?

Are car premiums on the way down?

Car insurance is one of the biggest annual costs for drivers, but there’s good news: Annual premiums are dropping fast and the price of cover is now, on average, £95 less than this time last year.

Price falls fastest since 2014

Policy prices have now fallen for the fourth quarter in a row, the biggest decline since 2014, figures from Confused.com show.

It’s welcome news for motorists, who saw prices rise continually for a number of years, reaching an average peak of £847 in the spring of last year.

Insurers pass on legislation savings

The 11% fall is partly a result of coming changes to the way personal injury claims are calculated, known as the ‘Ogden rate’, and in particular claims involving whiplash.

Recent legislation means pay outs should drop and, in anticipation of this, insurers have been able to cut cover costs for consumers.

Higher prices a thing of the past?

A spokesperson for Confused.com said “The end is in sight for the rollercoaster that has been car insurance, which has blighted drivers with accelerated prices. Average car insurance is now £752 and a whopping £95 (11%) cheaper than it was 12 months ago, putting the true impact of the Ogden rate discount into perspective”.

Prices still 50% higher in a decade

Prices are still considerably higher than the lows seen a decade ago, however, when the average price of car insurance was £499. Costs have since risen around 50% since, so there’s some way to go before drivers are once again getting what might be considered ‘bargain’ cover.

But at least prices fell for nearly all age groups this year. Those aged 68 are now paying an average of £496 a year or 8.7% less than last year, while 17 year olds saw a 5.7% fall to a still eye-watering average of £1,889.

Female drivers 61 to 65 are quids in

Female drivers between 61 and 65 currently pay the least for their car insurance, averaging just £356 a year, which is over half the national average.

Men still pay plenty more than women for their cover, but the gap has closed from £95 to £93 on average per year.

While the industry is no longer allowed to discriminate simply based on gender, the difference is explained by men tending to make larger claims than women, and driving cars with bigger engines.

Most expensive place to insure a car

East London continues to be the most expensive place in the country to insure a vehicle, with residents paying an average of £1,435, a drop of only £14 on 12 months ago.

Getting the best cover

Cheapest doesn’t always mean best when it comes to car cover, but it’s always a good idea to shop around at renewal time to compare deals.

Contacting an independent insurer, such as Policy Expert, can pay dividends as they often have access to deals which can’t be found elsewhere.

 

Policy Expert

The customer service team at Policy Expert is always on hand to help – either online or over the phone. Whether you want assistance in finding the right policy or even handling a claim, we make sure it’s all handled by experts. For more information on what‘s covered under your policy speak to one of our experts on 0330 0600 600 or visit www.policyexpert.co.uk/contact/ for more ways to reach us.

Published 17 August 2018