The average cost of car insurance in the UK has dropped by £87 (14%) in the past 12 months, after a turbulent year sparked significant changes in driving habits.

The latest car insurance price index by Confused.com found that throughout this past year, prices have been steadily declining, as drivers spend less time on the road. With fewer people driving regularly, the risk of accidents is much lower, meaning insurers are paying out less in claims.

Research suggests the average mileage of UK drivers dropped from 7,239 to 4,113 (43%) during the pandemic. Drivers can now expect to pay £538 a year for their car insurance.

But not all drivers will see these savings. While those shopping around and buying a new car insurance policy could have saved as much as £87, further research of UK drivers found that almost half (45%) of drivers who received their renewal in the past three months saw their price increase by £45, on average. This suggests they could be paying more by choosing to renew with their current insurer.

In fact, of the drivers who saw their renewal price increase this past quarter, almost half (48%) chose to stay with their current insurer, despite their price being more expensive. Of those who stayed with their current insurer, one in 10 (11%) claim the company automatically renewed the policy on their behalf.

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It’s this practice which makes it difficult for motorists to opt out of their policy and find a better deal. This is something that is being investigated by the Financial Conduct Authority (FCA), which is looking into changes that will make it easier for customers to cancel their policy and benefit from the price savings being reported for new policies.

The FCA’s proposal will not just make it easier to cancel auto-renewals, it is also set to prohibit insurers from calculating a price based on whether the customer is a new customer or a renewing customer.

However, this doesn’t mean that renewal prices will stay the same or decrease, as they could still increase year-on-year. The FCA has been clear that shopping around will still give customers opportunities to save.

While most drivers across the UK will see a cheaper price when shopping for a new policy, some will see some very significant savings – in particular, male motorists. The cost of insurance for men dropped by £91 (14%) year-on-year and £38 (6%) in the past quarter to £574, on average.

Meanwhile, female drivers shopping around will also have saved money during this past three months, with premiums now £82 (15%) cheaper than 12 months ago, and £36 (7%) less than last quarter. This means women are now paying £477, bringing the gap between male and female drivers to an average of £97.