The average cost of car insurance cover has fallen from £847 in mid- 2017 to £752 this year.
Comparison website Confused.com said that the 11% drop in premiums was due to a reversal of changes of the Ogden rate, which is used to calculate compensation for serious injuries.
“The end is in sight for the rollercoaster that has been car insurance, which has blighted drivers with accelerated prices. Car insurance is now £752 and a whopping £95 (11%) cheaper than it was 12 months ago, putting the true impact of the Ogden rate discount into perspective,” they said.
Falling prices may also be partly explained by a government ‘crackdown’ on whiplash claims, which it claimed would wipe £35 off the average insurance premium.
Average prices rose between mid-2014 and the second quarter of 2017. Prices have fallen in each quarter since then.
The Ogden rate is an assumption about the amount of interest that a claimant can expect to get on money they would otherwise invest.
Changes announced to the Ogden rate last February were at least partly responsible for the 2017 high of £847. The government’s decision to reverse the increase from 2.5% to -0.75% saved insurers from a multibillion-pound bill and helped bring prices down.
Despite the 11% fall this year, however, prices are still more than £250 more expensive than the lows of 2008, when the average insurance policy cost just £499.
Men, women and young people
Insurance premiums for men are still significantly higher than they are for women, despite 2012 legislation that banned gender discrimination.
Insurers say that £92 difference in policy prices for men and women can be explained because men tend to drive more expensive cars with larger engines. They also tend to have more motoring convictions than women.
Young people saw the biggest fall in car insurance premiums over the last year. The average premium for a 17-year-old fell by £403 over the past year – but even after the reduction, it stands at an average of £1,889.
The significant fall in young people’s insurance premiums was explained by the rising popularity of ‘black box’ telematics devices, which can be used to monitor a driver’s speed, braking and time of driving.