Car Insurance Decline: Reasons for the Fall in Insurance Premiums
by Faye Duncan
During the first quarter of 2018, a recent survey has found that motorists have been receiving the lowest car insurance premiums in 3 years. Car insurance can be a very expensive legal requirement so this decline will be great news for many drivers.
But, how much have the premiums dropped and what are the reasons behind it?
How much has car insurance dropped?
A recent study by a popular insurance price comparison site found that throughout the first three months of 2018, the average cost of car insurance for annual cover has been £768. This is £13 less than the average cost during the same period last year, declining premiums by 2%.
This may not sound like a lot to some, and it is still, on average, £97 more expensive than it was two years ago, but over the last few years premiums have gradually increased and this is the first drop since 2015, making a positive financial movement in the right direction for motorists.
Why has there been a decline in car insurance quotes?
It can be argued that insurers have been able to cut the costs of their car insurance premiums thanks to the Government’s new Civil Liability Bill. The Government revealed its plans to clamp down on whiplash claims and the way compensation is calculated for people with serious long-term injuries. The Minister of Justice said, “it would set a fixed amount of compensation for whiplash claims and require medical evidence before such claims can be settled.” This won’t be enforced until 2019, but it is possible that insurers have made the change to respond to these plans.
Who received the lowest car insurance premiums?
Surprisingly, young motorists received the biggest decline in car insurance premiums. Despite beginner drivers often being the age group that is charged more for car insurance compared to more experienced drivers, they have received the largest drop and have been paying an average of £118 less than they did in 2017. Although, on average, new drivers are still charged the most expensive premiums.
Unfortunately, some groups aren’t experiencing the unexpected lower costs. Drivers over 68 have received the opposite of the trend, with premium costs increasing by £40 since last year. But, it’s not all bad for them since they do, generally, pay less than the national average.
With regards to location, those who will benefit from the biggest saving are drivers living in inner London, with quotes dropping £81 compared to last year.
How to get lower car insurance premiums
Insurers often advise that loyalty will help you lower the cost of your car insurance; if you renew with your current insurers, they will reward you with a discount. However, this year, there has been a noticeable change and many drivers who opted to renew their policy have seen their premiums increase instead by an average of £45.
Have you noticed a decline in your car insurance quote? Let us know in the comments below.
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