Car insurance prices declining in 2020
Car insurance prices are on a downward trend in 2020, although they’re still higher than they were 12 months ago.
Research by price comparison site MoneySuperMarket found that, although average car insurance premium prices for fully comprehensive cover in the first quarter of 2020 were up year-on-year from £480 to £485 ($592 to $598) they are now declining, with average premiums in April at their lowest level (£462) in five years.
The study, which is based on seven years’ worth of data and millions of customer quotes, is one of the largest of its type.
The data shows that average premiums fluctuated across 2019, costing £480 in the first quarter, rising to £486 in the second quarter, and then dropping back down to £472 in the third. Premiums then rose 7% (£31) to reach £503 at the end of the year.
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The first quarter of 2020 saw prices fall by £18 to £485, which means fully-comprehensive car insurance premiums were up year-on-year by £5 from £480.
The first month of Q2 saw prices continue to fall, with average premiums in April 2020 at £462 — the lowest price in five years.
The year-on-year increase in the first quarter of the year is “partly attributable to price rises in the final quarter of 2019 in response to a change in the discount rate, which triggered premium inflation,” said Dave Merrick, MoneySuperMarket’s car insurance spokesman.
“But our latest research shows that April’s prices are at their lowest levels in five years. Whether there’s any link to the coronavirus crisis is difficult to say for certain, but it is likely to be a factor.
“An unintended consequence of the lockdown has been fewer cars on the roads and fewer accidents, so it’s fair to assume that this could result in reduced prices.”
Top ten most expensive locations for car insurance premiums
East London (£986)
Ilford & Barking (£900)
North-west London (£887)
Southall and Uxbridge (£858)
North London (£825)
Harrow (£762)
Bradford (£760)
South-east London (£752)
Manchester (£746)
West End London (£740)
When it comes to age, younger drivers still pay the most for their insurance. Prices are over three times more expensive for drivers under 25 than for older motorists over 50.
Those aged 17 to 19 face average premiums of £971 for a fully comprehensive policy — down 10% in the past year. Drivers aged 20 to 24 pay the most of any age group, with an average fully comprehensive policy costing £975 — up 2.9% year-on-year.
At the other end of the spectrum, drivers aged 65 or over pay just £289.
