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Car insurance costs fall

The average price of car insurance dropped during the third quarter of 2012, according to the AA

The cost of insuring a car is falling, according to the AA.

While premiums remained flat in the first two quarters of 2012, the average quote for comprehensive cover bought direct from an insurer fell by 2.9 per cent to £870 a year during the third quarter of this year.

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The cost of buying through a comparison website also dropped by one per cent to an average of £612.

However, the average price of a taking out a policy direct from an insurer is still up six per cent compared to the same time last year.

Simon Douglas, director of AA Insurance, says that the fall is down to stiff competition in the market: “Competition is tough in the insurance market, forcing many companies to reduce premiums despite the fact that costs show little sign of abating. Nevertheless, some are still increasing premiums.”

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