According to new research from comparison site Confused.com, car insurance premiums have fallen by 15% in the past 12 months, and are now at their lowest level for five years.
This year, the average comprehensive car insurance policy in the first quarter was £596. This has fallen to £579 in the second quarter, which sees a 2.8% decrease. This information has been established by the Confused.com Insurance Price Index, in association with Towers Watson.
Those who have had the most benefits from the fall in premiums are young drivers, with 20-year-olds seeing a 4.8% decrease, 18-year-olds more than 10% and price cuts for 17-year-olds amounting to nearly £1,000 (over 32%). All in all, annual price cuts for the under 21’s category have exceeded 20%.
Stephen Jones, UK head of P&C pricing at Towers Watson said
What is shows in particular is that the UK motor market is still competing and innovating hard in the younger driver segment.
He went on to say:
The publication of reports by both the Competition and Markets Authority on insurance repair costs and by the Transport Select Committee on whiplash and small claims have come too late to have much, if any, effect on this latest quarter, but it will be interesting to see if the proposals they contained influence insurers’ actions over the next quarter.
Head of car insurance at Confused.com Gemma Stanbury does not believe these drops in premiums will continue to fall. She says:
We’ve seen premiums reduce continuously over the last couple of years, so motorists should not necessarily expect prices to continue dropping at this rate.
James Rakow, insurance partner at Deloitte, agrees with this theory and predicts that premiums will rise over the course of a year, saying:
After nearly two years of falling prices, I expect car insurance premiums to start rising in line with inflation over the next 12 months.
If you are looking for a cheaper car insurance policy, read our tips on getting cheaper car insurance or find out more about how we can help you get a car insurance deal here: bobatoo.co.uk/car-insurance/