car insurance falls Car insurance premiums have plunged by an average of £100 so far in 2014, reveals new analysis by the AA.

However, the organisation warns that the 17% fall over the same period in 2013 may not last – and premiums may be set to rise once again…

The reductions we’re currently enjoying are down to improved fraud detection and legal reforms aimed at reducing spurious whiplash claims.

But, AA insurance director Simon Douglas told the BBC, “there is no evidence that this is delivering any significant reduction in the number and value of personal injury claims.

“I do expect premiums to start rising again this year unless the fraud issue can be dealt with.”

Average insurance bill now £500

Thanks to the reductions, the average fully comprehensive car insurance bill is £531, says the AA. This is 5.6% lower than Q4 2013.

The average third party fire and theft bill is now £725, 8.4% lower than Q4 2013 (and starkly belying the theory that third party is cheaper than fully comp…).

Fully comprehensive bills for young drivers have actually fallen by 20% compared to 2013, although they do face the highest bills overall.

MR SAYS: I have direct experience of these reductions, writes Richard Aucock. Due to a delayed long-term car delivery, I needed a budget car to pile the miles in – my old Merc’s classic policy didn’t allow this.

I had to thus take out a fresh car insurance policy, with no direct no-claims bonus – and when I was looking over Christmas, I was being quoted in excess of £750 in some cases. 

Thanks to choosing the right car (a Mk4 Golf GTI 2.0) and actually buying insurance in February, I ended up spending less than £300!