The average comprehensive motor insurance policy fell by £92 in 2013 to £644 according to Confused.com’s price index, but selective price increases appeared across some policies.
As the effects of the EU Gender Directive began to fully kick in, young male drivers aged 17 – 20 saw their premiums fall by 24%. Female drivers still enjoy lower average premiums with a £61 difference compared to males.
There could, however, be price rises on the horizon with males seeing their premium costs actually increase by 0.9% on average in the final quarter of 2013.
Gemma Stanbury, head of Motor at Confused.com believes this could be a sign of things to come: “These falling prices are welcome news for motorists; however the latest car insurance price index highlights that price rises could be on the horizon with some males already experiencing price hikes in the last quarter.”
The concern is that this is just a temporary measure from insurers following their lobbying against whiplash claims.
Solicitors have expressed concern that the price decrease could actually have been a short term measure. With the LASPO reforms reducing the legal costs personal injury solicitors can claim from road traffic accident injuries, insurers promised lower car insurance premiums as a result.
Paul Hinchliffe, Managing Partner at Bott and Co said: “It’s good news for the consumer that car insurance prices have fallen, but the concern is that this is just a temporary measure from insurers following their lobbying against whiplash claims. If premiums return to the high rates seen in 2011, motorists will have lost out twice.
“My other concern is that we have seen a reduction of 60% in legal fees law firms can be awarded for personal injury cases, and you have to be asking if 12.5% is a big enough premium reduction to reflect this.”