Premium Drivers index
Premium Drivers index
Each quarter, Compare the Market publishes research on the latest savings for car insurance premiums by comparing our ‘cheapest’ and ‘average’ motor premiums across all age groups to determine something we call the ‘savings variable’. The results help to give you an idea of how much it would pay to shop around for your car insurance.
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Our latest report suggests that insurance premiums have fallen during the UK’s coronavirus lockdown, with the average now standing at £702, from a previous average of £755. This new average premium takes us to the lowest since the third quarter of 2016, when the average quarterly premium stood at £698.
Car Insurance Savings variable
The savings variable is the figure given to the difference between the cheapest and average car insurance quote. Today, the average quarterly premium has dropped to £702, a decrease of £53 compared to £755 from the previous quarter. Meanwhile, the savings variable between March 2020 and May 2020 has fallen over the past three months to 15.30%, down from 15.98%.
After the savings variable had been falling steadily since Q1 2017, when it reached a high of 17.62%, premiums were starting to rise, with two successive quarters seeing increases in the average cost. However, the UK entering a nationwide lockdown could be linked to this trend reversing, with fewer drivers on the road bringing the average cost down.
Premiums Fall During Lockdown
When the UK government enforced a nationwide lockdown from 23 March, road traffic fell dramatically, with far fewer active drivers leading to few accidents and claims. As drivers became less of a risk to insurance providers, this may have contributed to the fall in premiums.
However, with recent government announcements leading to the easing of restrictions, drivers are more likely to take to the roads in the near future. This could see premiums rise once again. However, if you’re continuing to work from home, you may wish to contact your insurance provider to find out if this may reduce your premium.
Want to check that you’re paying the right price for your premium? Use our interactive comparison tool to see the average premiums for similar drivers to you.
Head of Motor insurance at Compare the Market
“The most common word used to describe the impact of the coronavirus is unprecedented. A drop in premiums, after years of rising costs, will be welcome news to the many families struggling financially as a result of the lockdown.”
“For those looking to reduce their premiums further, there are a number of steps that you can take. Our research shows that the difference between the cheapest and average premium is £108. Switching provider is a quick and easy way to reduce the cost. If you already have a motor insurance policy and coronavirus has affected your driving habits, you may want to notify your insurance provider. For example, if you are no longer commuting and are going to be working from home for the foreseeable future, there is a chance your provider could reduce your premium. Equally, it is worth telling your provider if you no longer expect to use your vehicle as much as you normally would, as a reduction to your anticipated annual mileage could also positively affect your premium.”
We carry out this research every quarter to find out what the current landscape means to you when it comes to buying your car insurance. Here you can see our previous reports to see how the industry has changed over the past year and what this means for your car insurance premium.