Average comprehensive private motor insurance premiums fell by 5% in the second quarter of 2014 to £361, compared to the same period last year, according to the Association of British Insurers.
However, its quarterly Premium Tracker published yesterday, highlighted that the price paid for private comprehensive motor premium in 2Q14 grew by £2 to £361 over the previous quarter this year.
Despite this, the trade body found that insurers were passing on cost savings of £378m in lower premiums to motorists during the period.
James Dalton, ABI head of motor and liability, said: 'UK motorists are continuing to get the best deals from a highly competitive motor insurance market. Everyone wants to see lower premiums, but government figures show that whiplash type claims have risen by 21% since 2010, while roads accidents have been falling.
'With whiplash claims costing motorists over £2bn a year, the government needs to press ahead with its much-needed plans to tackle the UK's whiplash epidemic, including introducing reforms to medical reports used for these claims and increasing the Small Claims Track Limit to £5,000.'
On Monday, the government announced that it would cut the fees for whiplash medical reports as part of its clamp down on insurance fraud. The fee change, which takes effect in October, will mean medical professionals can only charge £180 for an initial report, reflecting the time taken to carry out assessments and write them up.
Insurers Aviva previously said that so-called 'crash for cash' schemes, where fraudsters deliberately stage car smashes on unsuspecting motorists and claim for the damage and whiplash compensation increased by 51% in 2013.
It welcomed recent measures from Justice Secretary Chris Grayling to crack down on insurance fraudsters. These include new powers for courts to strike out claims where the claimant has been fundamentally dishonest.
Currently, even where a fraudster exaggerates his claim, he is entitled to recover his original claim, which provides little deterrent to discourage fraud, Aviva said.