Car insurance: when it pays to stick rather than switch

When it comes to car insurance renewal, sometimes it pays to break the rules.

You should never renew your car insurance with your existing insurer as you can always get a better deal by switching.

That's how the thinking goes, anyway. But in reality, it's not quite as simple as that. Sometimes it's possible to stick with your insurer rather than switching and still get a cracking deal.

I did it myself

My heart sank last week when an envelope with Aviva's logo dropped through the letterbox. Surely it wasn't time to sort out the car insurance again? I know I should, but I've never been one of those people that note in the calendar when the various policies need to be sorted out.

The renewal price wasn't much different from last year's price at £338. So I did what I always do – I went online and compared prices with a range of price comparison sites, including of course loveMONEY’s own car insurance comparison centre. The best price I could find was £316.

But I elected to stick with Aviva, for a couple of reasons.

Firstly, the Aviva Advantages discount scheme. Aviva customers can make the most of a host of discounts with partner firms, and it's a scheme I've made use of a few times, including helping me save a packet on last year's family holiday. That saving was far more significant than the money I'd pocket from switching insurer.

Then there was the small matter of the online renewal discount – if I renewed my policy online, rather than by post, Aviva would slice £20 off the price. So rather than a saving of £22 from switching, it would actually be £2. That’s just not worth going through the rigmarole of filling out the various forms associated with moving insurer for me.

So I renewed. I broke with the accepted wisdom, and to my mind I'm better off because of it.

It’s not always the case that discount schemes outweigh the savings you’ll make from switching though. But whether it’s an insurance policy or a regular household bill like your broadband or mobile phone contract, there are ways to still get a great deal without switching.

If you don’t ask, you don’t get

My dad worked in sales throughout his working life, so I've seen him haggle an awful lot. He has always drilled into me that if you don't ask, you don't get. It's not a very British thing to do, I know, but whenever dealing with insurers and utility firms it’s a good idea to push them to offer the very best deal.

It helps if you have done some background research yourself. A few years ago wheb my phone and broadband package with Sky was coming to an end I had a gander on broadbandchoices.co.uk and saw that another provider was offering essentially the same deal, but for £10 a month less.

So I called Sky and explained the situation. Obviously, I'd prefer to stay with them, but I could point to a clear saving I'd make by leaving. The chap went off to discuss what he could offer with his manager, and when he returned he matched the deal from the rival provider. Only 10 minutes homework and a quick phone call had turned into a £120 annual saving. Not bad, right?

Benchmarking like this can be really effective. You’re making clear to the firm exactly what you’re willing to pay. It’s then up to them to match it if they want to keep your business.

Take a look at the loveMONEY guide: how to haggle and save a fortune for tips on how to perfect your technique.

Get more for your money

There will be times when a provider won't budge on price. So see if they can throw in something extra.

Communication networks are a good example here again. See if your broadband provider can throw in something additional like a dongle or a Chromecast. Or if your package only includes free calls in the evening, see if they will throw in weekend calls for the same price as well.

By getting an added perk or two thrown in, you are still making a saving.

I get nervous on the phone!

If you are a bit wary about doing your best Del Boy impression on the phone, don’t worry. You can still bag a better deal via the online chat facility that most major firms offer now.

The fundamentals still apply - make it clear that you know how much you can save by moving, and see what they can offer. But the person on the other side of the chat has no idea that you’re sweating and your hand is shaking while you are negotiating!

If you want to switch, you can compare quotes from a range of providers with loveMONEY today

Find other ways to save:

How to get free and cheap cinema tickets

Money saving tips for under 30s

Buy your holiday wine, beer, vodka, gin, rum, Pimms and whisky for less

Save on shopping all year: from sales and voucher codes to cashback, haggling and loyalty cards