The average cost to insure a car has dropped by almost ten per cent over the past year, according to the AA.
Bbc.co.uk cited figures from the motoring group claiming that the average annual comprehensive car insurance quote is down to £594.84 this month after falling from £659.53 last July.
This signals a 9.8 per cent reduction over the year as well as a three per cent drop since April 2013. The cost of third party insurance has dropped significantly over the last three months, with policy holders now paying around 2.2 per cent less to get their cars covered.
Meanwhile third party, fire and theft insurance is now 4.8 per cent lower from last July, dropping to £820.58 in the biggest decrease since the AA began its insurance index in 1994.
Simon Douglas, insurance director at AA, said the falling price of insurance could be attributed to a number of factors, including improved fraud detection by the insurance industry and an EC gender directive that was introduced last December.
The new system for gender equality in buying car insurance has seen premiums for young men fall substantially, while those for women have experienced little movement.
In the coming years, the cost of insurance may fall even further as a result of motorists using tracking systems to give them a car insurance policy that reflects their driving habits and safety rating.
Talking to telegraph.co.uk, Mr Douglas said that insurers had been forced to increase their premiums between 2009-2011 after seeing growth in the gap between premium income and claims costs.
"That gap is closing and premiums are falling again thanks to competition, as well as improved fraud detection by the insurance industry and tightening of the law that is beginning to curb the number of spurious new whiplash injury claims," he added.