Car insurance costs have dropped to their lowest level since early 2023, with the average annual policy now costing £418, new data has found.
This represents a seven per cent decrease from the previous quarter, when motorists were paying an average of £450 for their cover.
The downward trend marks a welcome relief for drivers who have faced rising costs in recent years, bringing insurance expenses back to levels not seen for over two years.
The type of policy purchased significantly impacts pricing, with comprehensive cover offering better value than basic options.
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A comprehensive policy costs £418, providing the highest level of protection for just £10 more than a third party fire and theft policy at £408.
Surprisingly, Third Party Only insurance proves the most expensive option despite offering minimal coverage.
TPO policies cost an average of £559, making them 37 per cent more expensive than comprehensive cover while providing substantially less protection for motorists.
Regional variations reveal dramatic cost differences across the UK, with location playing a crucial role in determining premiums.
Drivers are paying the lowest car insurance prices for almost two years
GETTY
Tom Banks, car insurance spokesperson at Go.Compare, called on drivers to shop around to potentially save hundreds of pounds.
He said: "It's great to see that car insurance prices have dropped and while there has been some fluctuation in recent months, the general trend appears to be downward, which will be good news for motorists."
Banks highlighted that comparison sites feature over 100 insurance providers with different prices and coverage levels.
He noted: "Accepting the first price you're given is unlikely to be the best one. It doesn't take long to compare policies using a comparison site and you could save a significant amount of money on your insurance costs."
Drivers are being urged to compare car insurance prices to save money
GETTYLondon drivers face the highest costs at £598 annually, representing a 74 per cent premium compared to Wales, where the median cost stands at £343.
The substantial price difference reflects increased risks in the capital, including higher chances of vehicle damage or theft.
London motorists also face a greater likelihood of street parking rather than secure garage storage, contributing to elevated insurance costs across the metropolitan area.
There have been calls in recent years for the Government to slash Insurance Premium Tax (IPT) to help motorists deal with expensive coverage.
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At present, the IPT value on car insurance is 12 per cent, with this rate rising by around double over the last 10 years.
A study from 2024 found that 36 per cent of petrol and diesel car owners would invest in an electric vehicle if the tax were to be removed.
Data suggests that the Government raised £8.15billion through Insurance Premium Taxes in 2023.
The Go.Compare research also looked at which professions delivered the best cost savings for motorists, with postmen, gardeners and domestic staff seeing the lowest prices.
The top 10 professions for the cheapest car insurance price
Postman - £278
Gardener - £290
Domestic Staff - £293
Medical Secretary - £294
Administration Clerk- £305
Accounts Clerk - £305
Handyman - £306
Farmer - £306
Housekeeper - £309
Maintenance Man - £310
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