Car insurance policies ‘might not be as good value for money’ despite launch of major new law changes
Car insurance prices have dropped to their lowest point this year, with the average cost now standing at £437, according to new data.
The latest price index reveals a two per cent decrease from the previous quarter, when motorists were paying an average of £456 for their premiums.
The findings show comprehensive car insurance currently averages £437, while third party, fire and theft coverage costs just £1 less at £436 annually.
Third party only insurance, despite offering the lowest level of cover, comes with a surprisingly high average cost of £591 – 35 per cent more than comprehensive policies.
Do you have a story you’d like to share? Get in touch by emailing motoring@gbnews.uk
While prices have fallen in recent months, the data shows premiums are still four per cent higher compared to the same period last year in Q3 2023.
This trend reflects the ongoing fluctuations in the insurance market, with current rates showing signs of improvement for motorists.
Tom Banks, Go.Compare car insurance spokesperson, said: “It is very welcome news to find that car insurance prices have fallen – and we hope to see this continue, as premiums are still four per cent higher than they were this time last year.
“One surprising finding from our latest price index is that the more basic car insurance policies might not be as good value for money as you might think – with third party only (TPO) cover actually costing significantly more on average than a comprehensive policy.”
Banks advised motorists to explore different levels of coverage when renewing their car insurance to secure the best coverage at competitive prices.
Greater London continues to have the highest premiums for the average driver, with motorists paying an average of £632 for their car insurance.
In contrast, drivers in Wales and the South West of England enjoy considerably lower rates, paying just £358 on average.
This represents a striking 76 per cent difference between England’s capital and the regions with the lowest insurance costs.
Further relief for drivers is on the horizon following a Government policy change announced earlier this week regarding Personal Injury Discount Rates.
The rate will shift from -0.25 per cent to 0.5 per cent, marking the first adjustment in five years.
According to accountancy firm PwC, the change is expected to reduce motor insurance premiums in England and Wales by approximately five per cent.
Drivers could save around £50 as a result of the new rates, which are used to determine compensation awards for serious personal injury claims.
LATEST DEVELOPMENTS:
- Drivers warned of QR code parking scams plaguing major region impacting older motorists
- Rachel Reeves car taxes expected to raise billions for Labour with drivers left footing the bill
- Drivers see UK roads slow to 56mph with one major motorway operating at 43mph
The move follows similar changes which have already been implemented in Scotland and Northern Ireland earlier this year.
Mohammad Khan, head of general insurance at PwC UK, welcomed the changes, noting they would bring more consistency to how motor insurance premiums are calculated across the UK.
He described the adjustment as “good news for drivers” as it will “further intensify” competition in the motor insurance market.