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The cost of motoring insurances falls

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We do not know whether it is due to the intense competition, the fall in claims, the cost of repairs becoming cheaper, or the scam of whiplash that is being closely scrutinised, but the overall effect is that the cost of motor insurance premiums is falling.

The motoring organisation which has been monitoring premiums for the past twenty years, the AA, tells us that during 2013 a fall of 14.1% was noted which over a two year period amounts to a drop of about £100. Further falls are anticipated if the joint initiative between the DVLA and the insurance industry goes ahead, this is aimed at streamlining the application by providing information regarding any convictions and the date the test was passed.

The cheapest way to buy insurance is to pay immediately by direct debit; monthly payments can add a huge amount to the overall cost as insurers add a big mark up to cover administration and interest. Of course many people like to spread the cost of the premium, but it is better to take out a bank loan. The average added APR can be around 23%, or even as high as 31% in some instances, this will substantially add to the premium.

Shopping around on the internet is sensible and experience has shown that loyalty is meaningless to insurers, they will increase your premium up on an annual basis, check what others will offer you before renewing.

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Picture: Images_of_Money

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