Millions of motorists falling into the car insurance auto-renewal trap
Almost six million motorists allow their car insurance to auto-renew without bothering to check other quotes.
We’re heading into the busiest month of the year for car insurance renewals. Thanks to so many of us buying new cars when the registration plates change, many of us also end up renewing our car insurance every September.
But many of us are going about it wrong.
It will still be a good deal, right?
Research by GoCompare.com has found that 18% of us let our car insurance automatically renew with our current insurer. This is without bothering to check if the policy still offers good value and is the equivalent of around 5.8 million motorists.
Of those that do auto-renew, 39% assumed that because their policy had been the cheapest last year, it would still be good value.
Other reasons given for sticking with the same provider included loyalty, a good experience when making a claim and a straightforward fear of switching.
Car insurance is one of the most expensive protection policies we have to pay for, so it is surprising more people aren’t making the effort to shop around for a good deal. The survey found that 31% of drivers have been with the same insurer for three years or more.
“Even if your current insurer offered the best deal last year, you shouldn’t automatically assume that they will when your policy comes up for renewal,” said Matt Oliver, a spokesperson for GoCompare.com. Switching policies saves drivers an average of £208 a year according to Oliver.
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Complicated renewal packs
The research revealed that many drivers find renewal packs and the information they include substandard.
Almost half (47%) said it should be made clearer how much their premium price has increased from the previous year. A number of insurers have now agreed to start printing the previous year's premium on renewal letters. For more read Direct Line and LV= to include previous premiums on renewal letters.
Just half of motorists actually check last year's premium to see how it has changed, while more than a quarter (28%) said they felt under pressure to renew.
Getting the best deal
The worst thing you can do is simply renew with your existing insurer. It doesn't take long to search a comparison site like loveMONEY to get an idea of what rival policies will cost you.
For a comprehensive guide to getting the best possible price on your car insurance, check out Ways to cut your car insurance.
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Comments
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Finding a cheaper policy is all very well but there is a lot to be said for staying with an insurer who has proved to be fast and reliable at settling clsims. At the very least check reviews of insurers before changing.
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Auto renewing is not the worst thing you can do. Not renewing at all is far, far worse. That could be very expensive!!
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A questionable statistic. My policy auto-renews every year but that does not mean I do not check for better policies and would cancel my auto-renew if I found one. The auto renew is just there as a failsafe to make sure I do not forget, anyway I have 14 days to cancel it should I find a better one. So far in 10 years I have not found a better one, there may be cheaper ones but always read the small print to make sure they are suitable for you.
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30 August 2015