The coronavirus pandemic has changed much about life and will continue to do so for the foreseeable future. While obviously there has been a lot of doom and gloom, one small plus is the fact that the pandemic is likely to reduce the amount that you pay for your car insurance due to the fact that most people have signifi-cantly reduced their annual mileage to due the switch to WFH and restrictions in place.
A Fall of 6%
According to Confused’s car insurance price index, powered by Willis Towers Watson, the cost of insurance is down £52 since last year to an average of £763 – a decrease of 6% over the year. Despite this, research also revealed that more than two in five drivers (42%) who had their renewal in October-December actu-ally saw an increase by an average of £49 which is why people need to shop around.
One of the biggest factors when established car insurance cost is mileage, so it is understandable why the cost of car insurance has fallen since the pandemic. With people working from home, only able to leave the house for essential reasons for a large percentage of the year and restrictions in place, people have been driving much less and this is likely to continue this year too which means that you could be making savings on next year’s insurance.
With people spending less time on the roads, it also means that accidents are less likely to occur which means fewer claims are being made. With people driving less, motorists may also look to leasing as a more flexible and cost-effective option without worries about depreciation.
It is also interesting to see whereabouts in the country saw the biggest decreases. The cost fell across all regions, but those in South Wales and North East, Central and East Scotland seeing reductions by more than 10% on average. The smallest decrease was (unsurprisingly) in London with a decrease of just 3% low-ering the average cost to £1425. More locally focused data revealed that Harrogate in North Yorkshire saw the greatest fall in prices at 14%, making the aver-age premium here £559.
CEO at Confused Louise O’Shea commented on the findings:
“People are increasingly sensitive to price in the current economic climate, meaning we’re seeing more and more people shopping around as they look to make savings. Those shoppers are seeing some of the biggest savings on their car insurance for a long while and it couldn’t come at a better time.”
The coronavirus pandemic has changed people’s driving habits and this, in turn, has had a clear impact on insurance premiums. This is one small plus to take from the situation, which is helpful in a time where many people are worried about their finances and looking for ways that they can make savings.