Elderly drivers could save £1,200 on car insurance as prices plummet to 19-month low – ‘Delighted!’
Car insurance costs in the UK have dropped dramatically, with average premiums falling by 23 per cent over the past year, according to new data.
Recent research shows the average premium decreased to £729 in December 2024, down from £950 in December 2023. This marks the lowest monthly average since May 2023, when premiums stood at £718.
The significant decline may be attributed to stabilising claim costs as inflation has slowed in recent months.
However, despite the recent drop, current premiums remain £105 higher than they were in December 2022, when the average cost was £624.
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The substantial decrease means motorists who shop around rather than automatically renewing their policies could find considerable savings, with potential reductions of up to £510 through Compare the Market.
Young drivers have seen the biggest benefits from the insurance cost reduction, with premiums for those under 25 falling by £425 year-on-year. The average premium for motorists aged under 25 now stands at £1,577.
In contrast, older drivers have experienced more modest savings, with those aged 80 or above seeing their premiums decrease by just £61. Despite this, those aged between 65 and 79 could end up paying as little as £370 for their policy – more than £1,200 cheaper than the youngest drivers.
These variations in cost reductions highlight the significant differences in how various age groups have been affected by the recent market changes.
Julie Daniels, motor insurance expert at Compare the Market, said: “Many motorists will be delighted that the cost of car insurance has declined significantly compared to last year.
“As household budgets experience wider pressures, cheaper car insurance will be welcome news following the steep insurance price increases seen in previous years.”
London drivers have experienced the steepest decline in insurance costs, with premiums falling by £370 compared to the previous year.
Despite this substantial decrease, motorists in the capital still face the highest insurance costs in the UK, with average premiums of £1,202.
The picture is markedly different in Wales, where drivers have seen only modest reductions in their insurance costs.
Welsh motorists experienced a decrease of just £62 from the previous year, though they benefit from significantly lower average premiums of £620.
These regional variations demonstrate the continuing disparity in insurance costs across different parts of the UK, with London drivers paying nearly double the premiums of their Welsh counterparts.
Daniels noted that drivers should compare car insurance prices online before renewing with their existing provider, as they could save hundreds of pounds.
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She noted that while some motorists will see a drop in their price when it comes to renewing their insurance, they could save even more by looking around.
The research also revealed significant cost differences between transmission types, with automatic cars commanding far higher premiums.
Drivers of automatic vehicles face average premiums of £860, which is £217 more than manual car owners who pay around £643, typically due to their higher purchase prices and more complex gearboxes.