A survey from a leading UK motoring organisation has said that premiums for motoring cover dropped during the third quarter of 2012, in the wake of several years of significant price rises.

Having been flat for the first half of the year, it seems policy prices are now coming down.

The least expensive comprehensive policies bought through price comparison websites fell by 1% to an average of £612, while those purchased from insurance providers direct dropped by nearly 3% to an average of £870 annually.

This means that motorists still pay around 6% more for directly purchased policies than 12 months ago, during which time price comparison websites had become a little bit less expensive.

Competition across the industry remains tough, despite the rising cost of claims. This has forced many providers to bring down their premiums to win badly needed business.

With changes afoot that could affect the price of your premium, despite recent falls in price, you need to get the best possible deal on your motoring insurance. Those expecting a hefty rise in their premiums are being recommended to visit a comparison site such as comparethemarket.com and comparing quotes before the ruling comes in to effect.

The survey comes ahead of two significant changes in the vehicle insurance industry.

From 21 December, it will no longer be lawful for insurers to offer less expensive policies to women motorists, in accordance with a European Court of Justice ruling made in March 2011.

Some providers have previously warned that female drivers, especially those who are younger, could see their premiums go up by as much as a quarter, so that they are paying the same as their male counterparts.

According to some industry insiders, that increase could even be as high as 50%, and some companies could even put a complete halt on covering younger motorists.

In another change in the law, which kicks in April 2013, a practice which has helped push vehicle premiums up over the last 10 years will be banned.

The industry’s common acceptance of referral fees, to sell information on victims of accidents to claims management firms or no-win no-fee legal firms, becomes illegal in personal injury cases.

At the same time, anyone pursuing an accidental damages claim using a ‘no win no fee’ legal service will need to pay their lawyer’s bill themselves if they are successful, rather than adding it to the losing party’s bill.

This is set to make pursuing a claim a costlier affair.

At the same time, the government has said it aims to reduce the volume and costs of ‘whiplash’ claims that end up in court.

Insurers say these are among the key factors behind the escalating cost of vehicle insurance, and that the existing rules make many claims difficult to contest, or they are fraudulent.

Suggestions for the future include upping the small claims limit for personal injury cases to £5,000 from the current figure of £1,000, so that county courts deals with claims more cheaply, and the introduction of medical panels to determine the authenticity or otherwise of a whiplash claim.

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