Young drivers have benefited most, with year-on-year price cuts of nearly a third
Motor insurance premiums have fallen by 2.8% over the second quarter of 2014, according to the latest Confused/Towers Watson Car Insurance Price Index.
The average comprehensive policy was £579, down from £596 in Q1, making it the 10th consecutive quarter of price falls.
The decrease was largely driven by a cut in premiums for younger drivers, with those for 20-year-olds falling by 4.8% and by more than 10% for 18-year-olds over the last three months.
Annual price cuts for drives under the age of 21 have exceeded 20%, with 17-year-olds benefiting from year-on-year price cuts of 32.2%, or nearly £1,000.
Towers Watson UK head of P&C pricing Stephen Jones said: “This is a record 10th consecutive quarter in which prices have fallen overall even though some parts of the motoring population may not have shared in the latest reductions. What it shows in particular is that the UK motor market is still competing and innovating hard in the younger driver segment.”
And Jones said that while recent legal reforms will not have affected the Q2 premiums, he was expecting them to have an impact over the coming months.
“The publication of reports by both the Competition and Markets Authority on insurance repair costs and by the Transport Select Committee on whiplash and small claims have come too late to have much, if any, effect on this latest quarter, but it will be interesting to see if the proposals they contained influence insurers’ actions over the next quarter,” he said.
But Confused.com head of car insurance Gemma Stanbury said the recent spate of premium cuts is not expected to continue.
“While it is great news for consumers that premiums are continuing to fall, these ongoing drops in car insurance prices are unlikely to be sustained,” she said. “We’ve seen premiums reduce continuously over the last couple of years, so motorists should not necessarily expect prices to continue dropping at this rate.”