Rejoice! Car insurance prices are on the decline

Image of people celebrating
"Hey guys - heard the swell news about the price of car insurance?"
“Now the dust has settled on a transformed car insurance marketplace, there are definitely some bargains to be had"
  • | by Kristian Dando

Strike a light! The most recent AA Car Insurance Premium Index has revealed the biggest drop in the price of car insurance since 1994.

According the quarterly report, the average Shoparound quote (that’s an average of the five cheapest quotes for each ‘customer’ in a nationwide selection of risks, stats fans) for an annual comprehensive car insurance policy fell by a positively whopping £568.32 over the 12 months ending 30 September.

Just two years ago, premiums were increasing steadily, by as much as 40%. But the past year has seen them fall at an increasingly rapid rate.

Gocompare.com’s resident car insurance sage, Scott Kelly pondered: “It’s good news that premiums are falling, but remember: savings aren’t just handed down to drivers. In a lot of cases, you’ll have to shop around to find them.

“There’s no guarantee your insurer will give you the best deal at renewal – if you shop around, you may find another offering you a better deal.”

The past few years have seen big upheavals in the car insurance marketplace – in December 2012, the EU gender directive kicked in, and there’s also been a big clampdown in whiplash-related claims, too.

“Now the dust has settled on a transformed car insurance marketplace, there are definitely some bargains to be had,” says Kelly. “If you are still with the same insurer you had pre-December 2012, and you're coming up for renewal it could be well worth shopping around. Bear in mind that if you're looking to change insurer midway through the duration of a policy, you will probably have to pay an exit fee - you should weigh up the cost of this against the savings made from switching."