Car insurance prices decrease

The cost of car insurance has decreased for the first time in three years.

Car insurance is now £768 and £13 cheaper than it was 12 months ago, a small win for drivers after facing a range of price rises in recent years, according to Confused.com.

However, new research reveals customers who renew with the same insurer are not benefitting from these savings. A nationally representative survey of UK drivers revealed those who stayed with the same insurer and renewed their car insurance between January and March saw their premiums go up by £45 on average.

This suggests loyal customers who stay with the same insurer are not taking advantage of price reductions available by shopping around. Furthermore, 59% stayed with the same insurer rather than seeking out a better deal elsewhere.

Insurers seem to have softened prices as the Government announces a review of the Ogden Rate discount, which could mean insurers pay out less when a claim is made. The Government has also announced a reform to the way whiplash claims are calculated and paid which may have also had an impact.

Louise O’Shea, CEO at Confused.com, said ‘Finally drivers have had some good news with the end of rising car insurance costs in sight. However, it’s clear that many motorists are not seeing these savings reflected in their renewal letters, so it’s more important than ever to shop around if they want to get a better deal.’