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Drivers benefit from falling insurance premiums

Drivers benefit from falling insurance premiums

Category: Car insurance

Updated: 23/12/2014
First Published: 23/12/2014

MONEYFACTS ARCHIVE
This article was correct at the time of publication. It is now over 6 months old so the content may be out of date.

Drivers have been pocketing savings in 2014 after car insurance premiums fell over the year by more than 6%, according to comparison site Tiger.co.uk. This means that, when coupled with dropping fuel prices, drivers have clawed back significant savings after losing out during the inflationary years of 2010 and 2011 when car insurance prices rocketed.


Falling prices

According to Tiger.co.uk's research, average car insurance premiums were 6.1% lower in 2014 than in 2013. This follows falls in 2013 and 2012 of 2.6% and 3.2% respectively, meaning many drivers have now really started to feel the benefit of lower prices. In fact, in December alone prices fell by 0.6%, giving drivers some added festive cheer.

But why are prices dropping? Well, new legislation designed to cut the number of fraudulent claims could be having an effect. If fewer false claims are made, the smaller the bill the rest of us have to foot. Competition among insurers has also played its part, with price proving to be a particular bone of contention. "The 2014 price drops have been driven by a combination of intense market competition and by insurers taking into account the potential fall in claims costs as a result of changes in legislation," explains Andrew Goulborn, commercial director of Tiger.co.uk.


But is a rise on the horizon?

However, while things are certainly looking rosy at the moment, the downward spiral recently witnessed may not continue far into 2015. "We would caution vigilance at renewal time for all drivers," warned Andew Goulborn, "as we have, during the last three months of 2014, seen prices starting to increase for some of the profiles we monitor."

Indeed, although 2014 marks the third consecutive year that has seen prices drop, car insurance premiums in December were a surprising 0.7% higher than those seen during December 2013. This suggests that we have witnessed the lowest levels of car insurance premiums and that, from now on, we can expect prices to begin to rise
.


Bag the best deal

So, if your car insurance is up for renewal soon, take advantage of the current low prices and make sure you bag the best deal on the market by shopping around and comparing quotes. Car insurers rarely reward loyalty, so switching elsewhere could save you a decent sum of money. If you don't know where to start, check out our handy car insurance comparison tool to ensure that you don't see a premium price hike in the New Year.


What next?

Compare car insurance quotes

Disclaimer: Information is correct as of the date of publication (shown at the top of this article). Any products featured may be withdrawn by their provider or changed at any time.

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