Car insurance premium prices are beginning to fall, handing a boost to cash-strapped drivers.
A report by the Association of British Insurers (ABI) has found that average premiums have dropped to the lowest figure recorded in seven years.
Here, we explain what's happening to the cost of car insurance, and offer advice on getting a good deal.
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Drivers can now benefit from cheaper car insurance premiums, according to the latest report from the ABI.
Its quarterly tracker found that the average cost of a comprehensive policy fell by 5% year-on-year in the first quarter of 2022, to reach £416.
This drop means average premiums are now at the lowest price seen since 2015.
In January, new rules were introduced to prevent insurers quoting a higher price to existing customers than they would a new customer.
The practice, known as 'price walking', was outlawed in an attempt to make insurance pricing fairer and more transparent.
The ABI says it is too early to assess the impact of the new rules, but that the first indications suggest the average premium paid by drivers renewing their policies has fallen by £55 year-on-year.
The ABI's findings are something of an outlier, with other indices suggesting premiums are rising rather than falling.
The price comparison website Confused.com's most recent quarterly index found that average premiums rose by nearly 4% year-on-year, to reach £550.
These findings are echoed by Compare the Market, which claims premiums increased by £68 year-on-year, to reach £688.
These contrasting findings are due to the methodologies used - both Confused.com and Compare the Market use customer quotes to generate their pricing data, while the ABI uses the final price the customer pays.
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The ABI's report shows providers are competing to offer good deals, but it does note that insurers are facing significantly higher costs than before.
Cost pressures include microchip shortages, rising used car prices, more expensive repairs and a shortage of skilled labour.
James Dalton of the ABI says: 'Like other sectors, motor insurers face rising costs. While it is going to be extremely challenging for these to be absorbed, insurers are doing all they can to keep prices as competitive as possible as millions of household cope with the cost of living crisis.'
If your car insurance is coming up for renewal, it's important to ensure you're not paying more than you need to.
The abolition of the loyalty penalty means some drivers who are used to benefiting from new customer discounts each year may no longer enjoy the same savings.
Despite this, it's still worth shopping around, as you may well find that another provider will offer you a significantly cheaper price than your current insurer.
Your insurer should send you a renewal quote around a month before the end date of your policy.
If you do nothing, the policy will usually auto-renew at that price, whether you want it to or not.
If you find a better deal elsewhere, it's important to contact your current provider to cancel the auto-renewal.
Price comparison websites are a good place to start your search for a new deal. These sites will give you an indication of which insurers will offer the lowest premiums, and can help you compare the levels of cover on offer.
Don't forget to get quotes from insurers that don't appear on comparison sites, such as Direct Line and NFU Mutual.
Compulsory excesses are set by the insurer, but you can set your own voluntary excess, with options such as £100, £250 and £500 commonly available.
A higher excess can cut the cost of your premium, but setting it too high can be a barrier to making a claim.
Before ticking the boxes, consider whether you actually need these forms of protection and check if you're already covered elsewhere - for example some bank accounts come with breakdown cover, and key cover might be included in your policy.
Finding the best insurance deal isn't just about price. You'll want to ensure you're choosing a provider that combines a comprehensive and good value policy with great service should you need to claim.
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