Auto insurance rates fell in the first-quarter of the year for the first time in two years. The average price drop was offset by the announcement that the Association of British Insurers (ABI) has never seen rates this high at this time of year before.
Average prices for private motor insurance was £478, falling £13 on the final quarter of 2017. Year-over-year, prices rose £14.
The reduction has done little to offset drivers from paying record amounts for their premiums. The index, which is in charge of tracking average premium costs, was created in 2012 and tracks the actual price drivers pay for their insurance. Previous trackers tracked premiums based on quotes, which don’t take a driver’s history into account precisely.
Analysts claim that while the small decrease in average auto insurance rates is a welcome change for drivers, it is aligned with seasonal trends. Analysts also claim that insurance rates are under pressure from personal injury claims, with a rise in “crash for cash” claims in recent years.
Analysts further claim that prices fall in the first-quarter of the year, as new car registrations are due in March.
The Civil Liability Bill was also passed, which makes changes to the way personal injury compensation works in England and Wales. The ABI’s assistant director Rob Cummings also claims that “The Civil Liability Bill now going through Parliament will fix a broken system and help millions of motorists whose premiums had been going up and up over the last two years.”
Motorists question why insurance premiums have not gone down with a record number of motorists on the road.
The drop in the United Kingdom’s auto insurance rates has not reached into Canada, where insurance rates in Ontario rose 2% in the first-quarter of the year. The government’s promise to cut rates by 15% is slipping away, with the government promising to reduce rates in 2013, but the August 2015 deadline has long come and gone.
Ontario pays the highest insurance rates in Canada, with rates 45% higher in Ontario than Alberta in 2012. Young drivers in the age group of 16 to 24 suffer from the highest rates due to being “high-risk” drivers.
The Globe and Mail reports that rates for a 20-year old driver in Winnipeg with a clean driving record would be $1,396. The same driver in Toronto would be between $4,239 and $9,279. Investigations into the gap in insurance rates suggest that male drivers are being prejudged in Ontario, with males under 25 having the worst statistical record as a whole.
Statistics show that 24% of fatalities and 26% of serious injuries relating to auto accidents are caused by 16 – 24-year-old drivers, which represent just 13% of the driving population. Toronto is called a “special case” by insurance companies because the city has the most densely populated roads, high rates of theft and the worst roads in the region.
A new EU Directive is also being proposed, which will create a universal insurance history system that spans across the United Kingdom. The goal is to create a universal database to detect uninsured drivers, which add to rising insurance costs.