Car insurance costs continue to fall

For the second consecutive quarter the cost of comprehensive car insurance declined, the research from Confused.com and professional services firm Towers Watson has shown.

However, the gap between men and women remains with men paying on average £110 more for car insurance than female drivers.

The average cost of car insurance between April and June was £797, compared with £816 in the first three months of the year – a decline of 2.3 per cent.

Since the second quarter of 2011 the average premium is down 7.1 per cent. In the first quarter of 2012 premiums fell for the first time since the end of 2008. However, the average cost of car insurance today is still much higher than at the end of 2006, when it cost just £506.

Elderly drivers, those aged 71 or over, pay the least at an average £426 a year. They also enjoyed the biggest decline in the cost of car insurance over the year, a fall of 8.1 per cent.

Young men suffer

There were big falls in the amount paid by younger drivers as well. However, at £2,491 on average, the amount they pay is higher than any other age range.

Women aged 17 to 20 pay an average of £1,878 but young men pay nearly double at £3,596.

Male drivers in the 17 to 20 age bracket who live in Manchester or Merseyside pay the most for car insurance at an average £5,394. Men of the same age in central Scotland pay more than half that amount at £2,491.

Regionally the west of England enjoyed the largest falls in car insurance premiums at 10.5 per cent.

Gareth Kloet, head of car insurance at Confused.com, said: “Competition between car insurance providers is currently very high.

“We anticipate that drivers will continue to reduce their annual mileage as a result of high motoring costs and seek cheaper vehicles in their search for more affordable cover.”