Martin Lewis warns viewers about drastic car insurance changes
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Data from Compare the Market has found car insurance prices are falling by an average of £80 year-on-year in Q4. Average costs now stand at just £640 in the cheapest average price for a three month period since 2014.
However, experts warned prices are lower as part of a “clever pricing game”.
They warn insurers are trying to “lock-in as many customers as possible” before new rules will make it harder to tempt people to move providers.
FCA rules set to launch from January 2022 will prevent insurers from offering discounts exclusively to new customers.
The rules are intended to stop existing customers from being penalised by price walking cost hikes.
However, experts have warned it could see the end of low deals for new customers who switch providers.
The run-up to the rule change is therefore many insurers’ last-ditch effort to grab new customers before many will be locked into lengthy contracts.
Ursula Gibbs, Director at Compare the Market said motorists could save hundreds of pounds by making one last switch before the rules change.
She said: “Motorists will be glad that premiums are cheaper than last year but there is a sense of ‘buyer beware’.
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“It looks like insurers have been keeping premiums lower as part of a clever pricing game to try and lock in as many customers as possible before new regulations are introduced in January.
“Our figures suggest motorists could lose out if they auto-renew their policy.
“By switching to the cheapest premium instead, motorists could save around £100 and young drivers could see even bigger savings of almost £300.
“These savings gained by those drivers switching their provider could also help to offset the current rising cost of living.”
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