Enjoy the cheaper premiums while you can, experts warn

CAR INSURANCE NEWS ROUNDUP: WEEK ENDED 7 nov 2012:

While there has been some respite when it comes to the price of car cover recently, experts say it’s going to be short-lived, so you should take advantage now!

Motor car insurance – especially for young drivers – has backed off in price over the past few months, with one insurance comparison site’s research indicating that the cost of an average policy is around £360 cheaper, a drop of 13.6 per cent. However, with the European Court of Justice’s ruling banning gender-based insurance risk assessment going into effect next month, experts feel costs may rocket suddenly as insurers scramble to comply with the new regulations.

With that in mind, you’d have to be mad absolutely mad to wait much longer if you need to renew your annual policy soon, especially if you’re between the ages of 17 and 20. However, anyone can get in on the action now by looking for the best insurance rates you can find through the use of comparison websites – but do so soon before time runs out, or you could be paying through the nose come 21 December!

According to research, the average price of comprehensive cover has dropped by 10.3 per cent over the course of the past 12 months, from £843 to £757. This is of course an average across all ages, professions, and geographical locations, but an overall drop is absolutely good news for people already struggling under the crushing weight of insurance premium pricing for so long.

Not only that, but other experts say that this price reduction is unsustainable not just because of the impending ruling but because expensive insurance claims have not abated. The reason prices have been dropping lately is largely due to competition keeping costs for consumers down, but with car accident claims driving expensive compensation awards – and legal fees – insurers aren’t going to be able to keep it up forever and will inevitably have to begin raising rates again in order to get back into the black, which is just one more reason to renew your policy now and not later.

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