Drivers in Wales are being urged to cash in on car insurance savings ahead of an expected rise in other motoring costs later this year.
The average cost of car insurance in South Wales has fallen by £91 (-14%) in 12 months, to now sit at £578. Meanwhile in Central & North Wales, drivers are now paying £509 following a £52 (-9%) decrease in the past 12 months on average.
That’s according to the latest car insurance price index by Confused.com, powered by WTW, which is based on more than 6 million quotes over three months.
In particular, drivers in Cardiff have seen greater savings than the regional average, of 15%. This equates to a £109 saving, with the average premium now £516 in the area. Despite this significant decrease, it’s still the most expensive area in Wales for car insurance.
In Central & North Wales, drivers in Llandudno have seen the greatest savings, of £56 (-10%). This puts the average premium in the area at £516 – which is still the most expensive in the region.
Average car insurance prices in Wales
It’s a similar picture across the rest of the UK, where the average premium fell by £111 (-13%) to £726. This is the lowest prices have been in more than 2 years.
While car insurance prices have been dropping consistently for more than a year, prices are at the lowest point reported since March 2023.
Data suggests that shopping around 28 days before renewal could save as much as 53%, on average.
Drivers face an increase in Vehicle Excise Duty (VED) from April, otherwise known as road tax, which is set to rise in line with the Retail Price Index (RPI) inflation. EV drivers are no longer exempt from road taxes and will be paying the standard annual rate of £195.
Another price increase drivers could expect in 2026 is the amount paid in fuel duty. From September, the freeze on fuel duty, which is currently capped at 5p, is set to be reversed. This means fuel duty will rise each year with inflation, making it more expensive to fill up at the pump.
For those who frequently travel through the London congestion zone, prices will increase to £18 per day. And for this, EV drivers will no longer be exempt and could be paying 75% – 100% of the charge per day.
However, further research shows that while car insurance prices are dropping, many aren’t seeing these savings reflected in their renewal price. A survey of 2,000 UK drivers found that more than two in five (42%) saw their renewal price increase by £72, on average, compared to the previous year. Of these drivers, almost half (47%) shopped around and switched insurers, saving £87, on average. In comparison, only 29% had a cheaper renewal of £59, on average. However, more than a quarter (26%) decided to shop around, saving a further £63, on average.
Rhydian Jones, motoring expert at Confused.com car insurance, said:
“Car insurance is a considerable expense for many of us. But prices are cheaper now than they have been in recent years. And this is welcome news, given that many motoring costs are set to rise in 2026 – adding hundreds of pounds to our motoring bills.
“After insurance, fuel is another major cost for drivers, and if the fuel duty freeze ends this year, drivers will feel it in their pockets. Especially those who spend a lot of time on the road. And VED charges could increase for many too. While some may only see minimal changes, EV drivers in particular will be paying close to £200 more per year than they have previously.
“With this in mind, it’s more important than ever for drivers to save money where they can. Car insurance is a cost we can’t avoid, but there are ways to reduce it, such as improving vehicle security or adding a more experienced named driver to your policy. Ultimately, shopping around at renewal and finding the best price for you is the only way to know you’re getting the best price. And the sooner you do it after receiving your renewal notice, the bigger that saving could be.”
