Car and home insurance costs fall

Posted : 19-04-2005

The price of car premiums has continued to fall, a new study has found.

According to the AA's latest quarterly British Insurance Premium Index the cost of both car and home insurance cover fell in the first three months of 2005.

The average cost of comprehensive car insurance cover fell by £5 (0.7 per cent) over the last three months, representing a drop by 3.3 per cent over the past 12 months.

In addition, the typical home insurance premium fell by 0.9 per cent, countering the slight rise which occurred in the previous quarter.

Commenting of the figures, Kevin Sinclair director of AA Insurance, stated: "These results underline our expectation.

"Generally benign weather and low crime levels help to keep both motor and home premiums in check.

"And while these results are, of course, good news for customers, we need to be cautious that a return to more normal conditions doesn't lead to a sudden reverse of the current trend."

Mr Sinclair also underlined that insurance premiums are offering good value for money, stating: "Premium rises have generally been well below inflation as insurers have improved efficiency and kept costs down."

"In addition, 40 per cent of all car insurance and about a fifth of home insurance is now arranged online with providers…offering generous discounts for internet sales."

However Mr Sinclair also urged consumers not just to consider price when purchasing insurance but to examine the detail and quality of the cover.

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