Car insurance premiums fall by 14 per cent

For all drivers particularly those younger finding cheap car insurance offers can prove challenging. However, according to the AA’s British Insurance Premium Index the average price of comprehensive premiums fell by 14 per cent in 2013 compared to the previous year.

For last year it’s reported the average quote for car insurance cover in Britain went from £621 in January, to £559 in October and £533 this month.

This annual fall is the greatest reduction seen by the AA since it began its Insurance Premium Index back in 1994.

According to the AA the recent fall in average insurance premiums is due to the ‘more fiercely competitive market’ and expectations that fraudulent whiplash claims will be stamped out soon by new regulations.

Back in autumn last year the Justice Secretary, Chris Grayling, revealed measures to combat fraudulent whiplash claims in Britian. The proposals included independent medical panels will be set up to identify exaggerated or fraudulent claims.

Insurance providers reported last year that the current large extent of whiplash claims made by UK drivers every day is adding £90 to average insurance premiums.

Other findings from the British Insurance Premium Index regarding the past 12 months have been revealed.

Young motorists aged between 17 and 22 have seen the biggest drop to their average insurance premiums over the past year. A 5.4 per cent drop has been recorded. Still, while they typically look for the cheapest cars to insure, drivers in this age group still pay the most with an average cost of £1,187.

Drivers aged between 60 and 69 are the cheapest to insure, paying an average premium of just £302.

The North West is the most expensive region in Britain for insurance premiums, with average prices recorded at £809. At the same time however this part of the UK also saw a bigger average price drop than anywhere else over the past quarter.

The cheapest place in Britain for insurance premiums is Scotland, with average premiums currently recorded at £389. Over in London meanwhile drivers pay an average price of £629 to insure their motor.

Both insurers and the Driver and Vehicle Licensing Agency (DVLA) are working together on a new initiative to drive down insurance costs further for drivers. Called ‘My Licence’, drivers part of the scheme will be asked to provide their driving licence number to reveal a more accurate account of their experience and past convictions.

It’s estimated the My Licence initiative could cut down insurance premiums by an average £15.