Confused.com, Willis Towers Watson, and Fitch Ratings have all talked about the reduction in car insurance premiums – now another index has confirmed this positive development for policyholders.
According to the latest AA British Insurance Premium Index, the average shop-around price for an annual comprehensive car insurance policy has fallen 0.7% year-on-year and 2% on a quarterly basis to £660.64 in the first quarter of 2018. Citing rising fuel prices and increased vehicle excise duty rates, the AA’s director of insurance Michael Lloyd described the premium trend as “a glimmer of good news” for motorists.
“Insurers’ confidence in offering lower quotes is boosted by the government’s Civil Liability Bill commitment to review the so-called Ogden or ‘discount rate’ which affects the value of compensation payouts to severely injured victims of car crashes, as well as clamp down on the whiplash claim culture,” noted Lloyd. “This particularly affects premiums for young drivers who tend to be involved in more catastrophic crashes, and pay much higher premiums, than any other age group.”
The index shows male drivers aged 17 to 22 pay £1,766.17 on average for a year’s comprehensive cover; same-aged women, £1,505.28. Motorists in the 60s age group, meanwhile, pay an average of £403.
“In the competitive car insurance market, firms including the AA, will reflect savings they make in the premiums quoted – which the government suggests could be as much as 35%,” added the AA executive.
As for home insurance, policyholders have reasons to celebrate as well.
While average shop-around quotes for home buildings, contents, and combined policies remain higher compared to the same period in 2017, the AA’s British Insurance Premium Index showed quarterly declines. Premiums for standalone buildings policies fell 0.4% quarter-on-quarter; contents, 1.5%; and combined, 0.3%.
