Car insurance premiums are falling

The average cost of car insurance has fallen by £60 in the last year, new figures have revealed.

According to the ABI, the average premium was £562 between April and June this year.

That’s down from £622 in the same quarter of 2024. 

It’s also £19 (3%) lower than in the first three months of this year.

Mark Shepherd, head of general insurance policy at the ABI, described the figures as “encouraging”, as falling premiums offer “some much-needed relief to drivers”. 

“But with the cost of cover still weighing on household finances, we must not lose momentum in tackling the persistent pressures driving up claims,” he said.

For example, the increasing complexity of modern vehicles is driving up repair costs, while average payouts for vehicle theft have risen to £11,800.

How to cut the cost of car insurance

If you’re thinking of renewing your car insurance or switching to a new provider, there are several ways to keep prices down.

Research the market 

It’s really easy to just let your insurance renew automatically, as it’s one less bit of admin to do.

But that doesn’t mean you’ll get the best deal.

In fact, you could end up paying a great deal more if you don’t shop around and see what other insurers are offering.

So get on price comparison sites and the websites of companies who aren’t on these platforms to see what’s available.

Log your mileage accurately

Enter an accurate number of miles when you’re renewing or applying for insurance. 

If you overestimate, an insurer could see you as a bigger risk and hit you with a higher premium.

And if you underestimate, you could invalidate your policy.

Log your mileage each time you renew your car insurance so you have a regular check point each year you can refer back to. 

Lots of insurers also have annual mileage calculators on their websites which are useful.

Add another driver

Including a lower-risk driver, such as an experienced motorist or someone with a long no-claims record, can help reduce your premium.

But don’t list them as the main driver unless they genuinely are. 

This practice is known as ‘fronting’ and is a form of insurance fraud.

Make yourself a safer bet

Complete courses like Pass Plus or advanced driving training to show insurers you’re a safe driver.

Don’t pay for extras you don’t need

Many policies will include optional add-ons like car key cover or courtesy cars that you don’t necessarily need.

So look at what you’ll be paying for and what you really need before making a decision.

Time your renewal

According to GoCompare, the cheapest quotes typically appear 26 days before your policy renewal. 

So don’t leave it too late, as renewing early could save you up to 55%.

Negotiate with insurers

If you don’t think your renewal price is competitive, ask for a better deal. 

And make sure you’re armed with details on what rivals are offering, so you can make a strong case.

Install a black box

A telematics device records details like your driving habits and times of travel, so getting one fitted can help to prove you’re a safe driver.

Review your job title

Certain professions attract higher premiums because they’re linked to more claims.

So tweaking your job title could save you some money and is perfectly legitimate as long as what you choose still accurately describes what you do.