Unexpected fall in car premiums


By Nicky Burridge,Pa
Sunday 23 October 2011 08:02

The cost of car insurance fell unexpectedly during the first quarter of the year after premiums soared by a record 18.7 per cent during 2009, research showed yesterday.

The average price of comprehensive motor cover dropped by 3.2 per cent during the three months to the end of March to £968, according to the AA. But the group warned that the lull in rising prices was likely to prove temporary, and it expects there to be further double-digit increases during the whole of 2010.

The group said insurers typically held their premiums during the first quarter, when competition is greatest, as most policies are renewed during the first three months of the year. The cost of third-party fire and theft cover, fell by 4.5 per cent to average £1,196.

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