Car insurance prices drop £ 100 to six-year low
The BRITS have been hit by a series of price hikes in recent weeks, but good news is on the horizon for motorists at least – auto insurance costs are down.
Search by confus.com found that the average car insurance premium fell from £ 100 in the past 12 months to its lowest level in six years.
Prices are down 16% from a year ago – the biggest quarterly drop since 2014, according to the comparison site.
The average premium is now £ 514 for UK drivers.
It will be a welcome saving for households who have seen gasoline prices soar to an eight-year high and energy bills soar.
The latest auto insurance price index showed motorists in central London, Manchester and Merseyside have seen the biggest reductions in insurance costs.
Drivers in the capital could see their premiums drop to as low as £ 164 from a year ago – but it is still the most expensive place in the UK to insure a car at an average cost of £ 804 .
Those in Wales saw the smallest drop in price at £ 53, but their premiums are much cheaper at £ 346 on average.
Even young drivers, who pay the most for insurance, have seen their premiums drop 11% in the past year. The average premium is down from £ 176 to still expensive £ 1,379 per year.
Male drivers saw a larger drop in insurance costs, falling from £ 103 to an average of £ 549. Meanwhile, motorists will see their average premium drop from £ 88 to £ 456 per year.
Why is auto insurance cheaper?
The Covid pandemic is one of the main factors in the fall in the cost of car insurance.
During last year’s shutdowns, many people were driving much less than usual, meaning fewer claims were filed.
Police even reported a 26% drop in the number of road accidents they witnessed, according to Confused.com.
As a result, insurers’ expenses have been lower over the past year and they can reflect this in their prices.
But people are urged to strike a decent deal now, as prices could rise in January when new rules take effect.
Martin Lewis is among the experts warning drivers to shop now even if their policy is yet to be renewed.
Starting in the new year, insurers will have to charge new and existing customers the same price.
Historically, people who stayed with their insurers year after year without haggling would pay more than those who shopped.
New customers were offered much cheaper offers to encourage them to switch providers.
But the new rules introduced by the financial regulator will eliminate loyalty penalties.
While it may sound like a positive, it could end up hitting some people in the pocket.
Martin warned this week, “I guess companies won’t just cut renewals to match entry-level prices. They will lower them somewhat and raise the rates for new customers – meeting around the middle.
“As the new scheme officially kicks off in January, because it is a big job, insurers will likely start changing pricing algorithms sooner, so time is running out and the cheapest prices may start to disappear in the near future. weeks or months. “
He advises home and auto insurance customers to start shopping now for the best deals before they’re gone.
You should be able to cancel your insurance even if you are in the middle of the policy and get a pro-rated refund.
How to find the best deal
With motorists back on the roads and driving more and more, along with new regulations, it is likely that insurance prices may soon rise again.
This means if your current deal is coming to an end, it’s time to shop.
And even if it doesn’t, until there is a huge exit penalty, it might be a good idea to exit your current insurance policy earlier to take advantage of cheaper prices while you are can.
Louise O’Shea, Managing Director of Confused.com, said: “It is likely that prices could start to climb as people return to work and people spend more time traveling on the road, which means that the risk of accident is high. upper.
“We are already starting to see this in parts of the UK. And that will mean that the overall price of insurance will go up, and your renewal might go up as well.
“Unfortunately, we’re also seeing an increase in many other household bills, especially energy, so it’s more important than ever for consumers to save money while they can. “
Comparison sites like Go Compare, Compare the Market, Uswitch, and MoneySupermarket are good places to start.
It’s usually worth using more than one, as different comparison sites will have different offers.
Some insurers, notably Direct Line, do not use these comparison sites, so it is worth checking their websites directly for quotes.
Don’t just choose the cheapest policy – consider factors like how much deductible you’ll have to pay if you make a claim and the limits of the insurance.
It’s also worth checking out sites like Quidco and TopCashback to see if you can earn some extra cashback as well.
Other tips to help you further reduce auto insurance costs. For example, a study by Compare The Market found that policies are £ 319 cheaper if drivers change three weeks before their renewal date compared to changing on the day the policy ends.
Paying annually, getting a black box, and adding a named driver are other tactics that can help. We’ve rounded up the top nine strategies in our guide.
Adjusting your job title is another way to cut your bill by hundreds of dollars. This does not mean lying – which is a bad idea – but deciding to select “cook” or “chef” for example.
Martin Lewis’s MoneySavingExpert has built a smart tool to help you do it legitimately and not in a way that invalidates your insurance.
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