News from global advisory, broking and solutions company, Willis Towers Watson says insurance premiums have fallen 11% since 2017.
The most recent Confused.com Car Insurance Price Index shows that drivers in the UK are now paying, on average, £95 less for comprehensive car insurance than they were twelve months ago, with an average premium costing £752 a year. The Confused.com Car Insurance Price Index uses the data from all the enquiries submitted on their comparison website and the company say they hold the most comprehensive data in the UK, with their website producing over 24 million quotes every year.
Is it all good news?
The insurance premiums of young drivers dropped, with the average cost of insurance for a 17-year-old dropping by £403. One big reason is the increased use of ‘telematics’, which monitors the driving patterns of motorists, with safer driving habits reflecting a lower annual premium. Still, insurance costs remain high for young people, who pay an average of £1,889 each year.
Older drivers are benefitting too, with those aged 68 paying an average of £496—an 8.7% quarterly cut—and the average female aged between 61-65 pays half the national average insurance bill, at around £356 a year.
Northern Ireland drivers enjoyed the biggest drop in insurance premiums, seeing prices 4.3% lower (£894). It’s not good news for everyone, though, with motorists in the Scottish Highlands and Islands experiencing a rise in premiums in the past three months, by an average of 1%.
While motorists will welcome the reduction in the cost of premiums, prices aren’t anywhere near as low as they were in the second quarter of 2008, when the average car insurance premium cost, on average, £499. Confused.com reports that prices are up by £37 since 2016 and £74 since 2013.
UK motorists saw a steep rise in car insurance premiums, last year—due to a change former Lord Chancellor, Liz Truss made to the Ogden discount rate—with average premiums rising to £847 in the second quarter of 2017.
After a severe backlash from the insurance industry, who called the changes “reckless in the extreme”, saying they would have to make dramatic increases the amount customers would have to pay for car insurance—to make up for the shortfall they’d have to pay out in larger lump sums—the Ministry of Justice made a slight alteration to the discount rate.
After prices reached a high of £847 last summer, the cost of insurance premiums has reduced over each of the last four quarters including a 2% fall since April.
Steve Fletcher, Head of Data Services at Confused.com, said: “While prices are continuing to drop, they are doing so at a much slower rate than the last quarter. This suggests there appears to be a correcting of the steep increases we saw this time last year, where insurers increased their premiums following the change to the Ogden rate. What we are now seeing is the plateauing of increases over the past three years, and potentially the home-coming of a period of steadily decreasing premiums.”
Ways to slash your insurance costs
If you have a garage so full of junk, you can’t use it for its intended purpose, maybe you should declutter. You may find you don’t need half of what you’ve been storing—if you even remember what’s there. Parking in a garage instead of on the road will often bring down your insurance bill—but not always—so experiment with quotes to find what’s best for where you live.
Consider increasing your voluntary excess—but make sure you have the money set aside should you need to make a claim—and, if you can, pay your insurance premium on an annual basis instead of each month. This will shave a nice bit of money off your bill.
There are many other ways to reduce your insurance costs. Another way is to drive fewer miles. Insurers look at mileage because the further we drive, the higher the chance of being involved in an accident. We’re all guilty of driving when we could walk or cycle. Leave the car at home sometimes and you can help your wallet, your health, and the environment.
Comparison sites such as Confused.com are wonderful tools for finding a great deal on car insurance but don’t rely on them, alone. Many insurers aren’t on comparison sites, so explore those too before making a purchase. Search before your policy is due to expire to avoid an often costly auto-renewal.
PetrolPrices currently has a deal with Confused.com to help you find the cheapest car insurance, and if they can’t beat your renewal cost, they’ll pay the difference plus give you an extra £20! With Confused, you compare quotes from over 120 insurance providers to help find the cheapest, and best, cost for your insurance. If you want to save money on your car insurance, start comparing today!
What do you think of this news? Have you seen a reduction in your car insurance premiums? What strategies do you use for lowering the cost of motor insurance? Let us know in the comments.