The average cost of a comprehensive motor insurance policy decreased to £370 in 2013, 9% down on the previous year, the Association of British Insurers said.
According to the ABI, this average cost reflected a downward trend in the average premium paid over the past eight quarters from £415 in the first quarter of 2012 to £370 in the fourth quarter 2013, a drop of £45 or 11% per policy.
Current premium levels, collated by ABI's quarterly average motor premium tracker, are based on data from the association's members who represent around 90% of the UK private car insurance market.
James Dalton, ABI's head of motor insurance, said: 'The 9% fall in the average comprehensive motor premium last year shows that insurers are fulfilling the commitment they made to the government to pass savings from changes to the civil litigation system to hard-pressed motorists through lower car insurance premiums.'
However, he added that more needed to be done to get premiums even lower and urged the government to press ahead with tackling exaggerated and fraudulent whiplash claims.
Meanwhile, AA Insurance's latest Premium Index said over £100 had been slashed off car premiums in just two years.
The insurer's figures, which cover the last three months of 2013, showed further falls in the cost of car insurance, continuing the downward trend that started during the first half of 2012. But the firm predicted that the 'boon for motorists, will soon end'.
Director of AA Insurance Simon Douglas said: 'These record falls come despite continuing rises in the cost of personal injury claims and reinsurance costs.'
Echoing Dalton's statement, Douglas too pointed out that falls in premiums were a combination of 'both the fiercely competitive nature of the market as well as the anticipation that law changes will weed out costly fraudulent whiplash injury claims'.
But he noted that that over recent year's court awards for those seriously injured in car crashes had increased.
'The industry is seeing more multi-million pound lump sum payments for those who have suffered life-changing injury as well as periodic payment orders [PPOs] which guarantee regular payments for life,' he said.
'These have led reinsurers to increase their rates by up to 30% and some of that will find its way to premiums paid by motorists.'