Car Insurance premiums have fallen, for some

After several years of steep increases in car insurance quotes, we have seen a change this year. The first part of the year saw premiums flattening, with the latter half seeing such premiums falling. The cheapest policies fell by just under 3% when bought directly from insurers and by 1% when bought through comparison websites.

Still pricey, but getting better!

Although there has been a drop, policies bought directly from insurance companies are still 6% more expensive than a year ago. Policies bought via price comparison web sites also fell, by 1% to an average of £612. The AA’s Simon Douglas said that premiums were being pressured by increasing competition from business, despite the actual claim cost increasing. He said that “Competition is tough in the insurance market, forcing many companies to reduce premiums despite the fact that costs show little sign of abating,”

New regulations

In December, there will be the introduction of new EU regulations which will not let insurers grant cheaper car insurance premiums to women drivers. The European Courts of Justice have ruled that doing so is illegal and is effectively discriminatory towards men. This cost will be transferred onto annuities too. Female drivers will see their premiums rising by around 25% with some predicting that the rise may be as much as 50%.

Clamping down on claims

From April next year, there will also be a ban on the sale of accident information onto claims management or law firms. Anyone suing for damages will also need to pay their lawyers a success fee from the compensation money. This will make following up claims more pricey.

However, new regulations are going to attempt to cut down on whiplash claims which are causing insurance premiums to rise so quickly. Most of these claims, it is believed, are fraudulent. Simon Douglas said that “Whiplash injury claims continue to pour in and under current legislation, they are difficult for insurers to reject, even if they think they may be fraudulent, because it is difficult to prove whether or not a claimant has suffered,”

There are sure to be some interesting times ahead for car insurance premiums!

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