Auto insurance costs drop to record highs
The cost of auto insurance has fallen to its lowest level in more than five years, new data shows.
On average, UK drivers can expect to pay £ 522 if they shop for car insurance, after prices have fallen by £ 71 (12%) in the past 12 months.
Before that, prices had been rising steadily, reaching £ 630 at the end of 2019.
However, since then, the latest index tracker from price comparison site Confused.com shows that prices fell 14% in the first quarter of the year – the steepest price drop on top of six years.
The price change is attributed to the pandemic which significantly reduces the risk on UK roads.
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Police forces reported 192,001 traffic accidents in 2020, up from 258,994 in 2019.
Data from the DVLA also shows that the number of people requesting off-road legal notification (SORN) increased from 250,352 to 526,747 between February and March of last year,
Louise O’Shea, CEO of Confused.com, says insurance savings are only seen by drivers who shop.
Additional research by the group found that nearly two in five UK drivers (38%) who received their renewal notices in the last quarter (April to June 2021) say their insurance company has increased the price. of £ 44, on average.
This is something that was addressed by the Financial Conduct Authority (FCA), which said insurers need to make it easier for customers to cancel automatic policy renewals.
Drivers, both men and women, have seen their prices drop by 12% in the past 12 months, although for men that equates to a saving of £ 75 and £ 63 for women, on average.
This brings the average cost of insurance for both sexes to £ 557 and £ 464, respectively, and the gap between the two to £ 93.
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Although all UK drivers have enjoyed savings this quarter, the amount will depend on where they live.
Drivers in Inner London, Manchester and Merseyside saw the biggest monetary decline in car insurance costs.
Prices at Inner London are now £ 102 (11%) cheaper than 12 months ago, and £ 101 (13%) cheaper in Manchester and Merseyside, on average.
However, these are the most expensive areas in the UK for car insurance, with drivers paying an average of £ 808 and £ 675 respectively.
That’s almost double the amount paid by drivers in cheaper areas.
For example, those in the Scottish Borders pay £ 337 and some drivers in the Highlands and Scottish Isles pay only £ 320.
Northern Ireland, however, is the only region in the UK where prices rose in the last quarter, up £ 5 (1%) in the past three months to £ 530.
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However, as the price of car insurance goes down, some car costs are starting to rise as the UK comes out of lockdown.
Confused.com’s Fuel Price Index suggests gasoline and diesel prices have been on the rise since late last year. According to the data, drivers can now expect to pay an average of 131.4 pence for gasoline. This is 17p more than in November 2020.
Louise O’Shea, CEO of Confused.com, said: “What we know is that only those who shop see significant price drops, and insurers continue to raise renewal prices for their loyal customers. .
“While the new rules set by the FCA will prevent insurers from pricing new customers and renewing customers differently, that doesn’t guarantee you the cheapest price.
“Changes to the way insurers calculate their prices, or if prices start to rise in the market, could cause renewal prices to increase. ”