You could be missing out on £110 per year if you’re not switching insurers when your car insurance comes up for renewal, according to our latest Premium Drivers report. The latest installation highlights that the average car insurance quote for December 2015-February was £682.26, over £100 more expensive than the cheapest quote for the same period.
Premium Drivers, our quarterly report exploring the change in car insurance premiums, shows that prices in general are on the rise. Compared to the same time last year, the cheapest car insurance price has risen to £552.95, making it 17.5% higher than it was in February 2015.
In fact, prices have risen substantially in the last quarter alone. From September- November 2015, the cheapest premium came in at £549.04 on average and has risen to £571.68 in the latest report. This shows that in the last 3 months alone, the cheapest premium has risen by £22.68. And that increase is even more substantial for the average premiums which rose £27.09 in the last quarter.
The news is even more worrying for young drivers as they seem to be taking the biggest hit when it comes to premium increases. According to the report, the average price presented to U21s over the last 3 months was a whopping £1482.90! That’s over £800 more than the average price presented across all age groups. But younger drivers can still save money on their car insurance by switching. The report also shows that the cheapest price presented to U21s was £1162.46 which is £320 less than the average.
And it’s obviously not just U21s that could save by switching. With the average disparity between the cheapest and average car insurance prices on the market coming in at over £100, it’s clearly important for us all to explore our options when it comes to renewing.
Simon McCulloch, our Director of Insurance, says, “Unfortunately, the rise of motor insurance premiums does not seem to be going away any time soon. While external factors like the Insurance Premium Tax hike will have inevitably pushed up premiums, it seems that the inertia of some motor insurance customers has been the real driver of the premium increase.
“Increasing competition in the market place is the only way to truly reduce prices and, for motor insurance, that means getting more people switching.”
What that means for us is that the more people that look to switch, the more insurers will be forced to stay competitive. And to stay competitive most insurers will need to look at their pricing. So if your policy is up for renewal, you can compare car insurance quotes now to make sure you’re getting the best deal for you.
Premium Drivers tracks the “savings variable”, which is the difference between the average and the cheapest motor premium prices across all age groups. This measure gives an indication of the level of price competition currently associated with motor insurance premiums.
When the average priceis referred to, this is the mean average of the top five cheapest prices presented to a customer, where a customer has clicked through to buy. Buying from the top five cheapest prices presented represents 90% of all car insurance sales. When the cheapest price is referred to, this is the average cheapest price presented, where a customer has clicked through to buy.