- However, with car insurance prices falling by £57 (-7%) since the end of last year1, drivers could be offered some respite from high insurance bills.
- The average cost of insurance in the UK is now £777 - with younger drivers seeing the biggest savings of £711.
- But research shows drivers could be losing £164, on average, by not shopping around.
- Experts at Confused.com offer tips to drivers on how to save money when it comes to shopping for car insurance, and leave the savings be!
Millions of drivers have had to make financial sacrifices to pay for the cost of driving, new research reveals.
With the cost of insurance reaching record highs, and car repairs and fuel costs increasing in recent years, running a car has become a financial burden for many. And it’s impacting drivers’ financial goals as a result.
In fact, millions of drivers have had to cut back on personal spending or dip into their savings to cover motoring costs. That’s according to new research by car insurance experts at Confused.com.
According to the research, more than 1 in 2 (52%) UK drivers have made financial sacrifices to pay for their car insurance. This includes 1 in 4 (25%) saying they have used personal savings. Meanwhile, 1 in 7 (15%) have cut back on personal spending to cover the cost of their insurance. Many have also had cut back on personal plans, such as turning down social events, or using money saved towards a house deposit.
Similarly, almost 3 in 5 (58%) drivers admit to making financial sacrifices to cover the cost of car repairs. 1 in 3 (33%) have had to take money out of their personal savings to pay for repairs.
It comes as no surprise that drivers are feeling the pinch when it comes to motoring costs. Insurance prices alone have become increasingly unaffordable for many over the past 2 years. In 2023, the average cost of car insurance in the UK reached £995 - the highest on record. This meant that many drivers were paying more for their insurance than ever before.
However, new data from the Confused.com car insurance price index shows that there could be some respite for drivers. According to the data, the average cost of car insurance in the UK has fallen by £57 (-7%) in the past 2 months. This puts the average premium now at £777.
Compared to March last year, this is £164 (-17%) cheaper, meaning those who are shopping around are seeing significant savings on their new policies.
But many drivers are losing out on this saving. According to the research, more than half of UK drivers (56%) received a more expensive renewal price from their current insurer in the past 12 months. Yet, more than half (56%) of these drivers opted to stay with the same insurer. Worryingly, almost 3 in 5 (58%) drivers aren’t aware they could save money by shopping around.
According to the data, some drivers could be seeing even bigger savings if they choose not to settle and look for a new policy. In particular, 18-year-olds are now paying £711 (-23%) less for their car insurance compared to March last year. This means drivers of this age are now paying £2,434, on average. This is the lowest prices have been for drivers of this age in almost 2 years.
Meanwhile, 17-year-olds are also facing significant savings, with prices now £661 (-23%) cheaper than last year. This means drivers of this age are now paying £2,258, on average.
Similarly, drivers in Inner London are now paying £293 (-20%) less for their car insurance, compared to March last year. Average premiums in the region are now £1,208.
Despite insurance prices dropping, they’re still significantly higher compared to before. In fact, they’re 18% higher compared to 2 years ago, and 24% higher compared to 2020.
But it isn’t just the cost of driving that’s increasing. Household bills and day-to-day expenses are getting increasingly higher, making the financial strain of running a car even harder. It’s no surprise that 1 in 5 (20%) drivers are starting to drive less often due to the cost of living.
And while insurance prices may be easing for some, there are still ways for drivers to save money when it comes to shopping around.
Confused.com experts offer some tips on how to get cheaper car insurance:
- Don’t settle - even if your renewal price is cheaper than last year, you could save even more by shopping around. And doing this around 3 weeks before your renewal date could offer the biggest savings.
- Be accurate with your mileage - underestimating your mileage to suggest you’re driving less could in fact have the opposite effect. Drivers who are on the road less could be deemed as less experienced and therefore a higher risk. You should always be accurate with how many miles you expect to drive, or you could invalidate your policy.
- Enhance your car security - many modern cars are installed with safety features that will reduce the risk of theft. But adding a steering lock or parking in a well-lit area will reduce this even further and could save some money on your insurance too.
- Check your job title - often there are many ways to describe the same job, some of which may appear a higher risk than others. When quoting, look to see if another job title fits your description and see if it can improve your price.
Rhydian Jones, motoring expert at Confused.com comments, “Driving offers us our freedom, but recently, it’s become an expensive luxury! Insurance, repairs, and even fuel have all increased in price in the past few years. And alongside other day-to-day spending, it’s a big financial commitment.
“The good news is that insurance prices are coming down. And when you’re shopping around, you should see a cheaper price than you paid last year. But we also know that this isn’t always the case when it comes to renewal prices. This is why it’s important to look at the price you’ve been given, and compare to see if there’s a better price for you. Doing this around 3 weeks before your renewal date could offer the best price.
“But the savings don’t have to stop there. Looking at things like your mileage, how you use your car, and if you can increase your car’s security, could all contribute to a lower price too.”
“Simply accepting a price because it looks good could mean you’re missing out on great savings. Shop around, see what works best for you, and you could save some money to help with savings, or other personal plans!”
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