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Millions of car insurance mistakes are made every year that add £50 to the bill

Millions of motorists are overpaying for their car insurance at £830m a year – but you can save money by shopping around for the best rates

Drivers are still paying too much for their car insurance
Drivers are still paying too much for their car insurance

About 17 million drivers overpay them Car’s insurrance down £50 last year due to renewal with their current insurer, the study found.

Price comparison website MoneySuperMarket says the additional payments have amounted to £830 million.

About 52% of drivers allow them Car’s insurrance automatically renews in 2021, up 27% from 2020, when 41% did so.

Drivers have seen insurance premiums increase average £49 – up 17% from 2020 when drivers claim to see an average increase of £42.

An increase of £26 to £50 was seen by 15% of motorists, while 1 in 10 saw increases between £51 and £75 (11%) and £76 to £100 ( twelfth%).

By region, drivers in London reported the biggest increase in their average premiums at £79, followed by drivers in Northern Ireland (£61) and drivers in the West Midlands (£60) ). Welsh drivers saw their premium rise the least, at £31.







Car insurance is important, but you shouldn’t be ripped off in the process
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Image:

Getty Images / iStockphoto)

Of those surveyed who renewed their car insurance, a quarter (25%) shopped around but stayed with their current provider for ease – a 20% increase compared to last year.

More than one in ten (14%) believe changing car insurance providers takes too much time or effort, and nearly one in five (19%) don’t believe there will be significant savings.

“Last year, more drivers renewed their car insurance with their current provider than did not,” said Sara Newell, car insurance expert at MoneySuperMarket.

“With motorists reporting an average premium increase of £49, this means that overall, UK drivers have overspended on their premiums by an estimated 830. million pounds.”

From January 1 of this year, car insurance companies have been banned from charging renewed drivers more than new ones.

In the past, it was a common industry practice to subsidize cheap insurance premiums for motorists shopping around by overcharging loyalists.

The Financial Conduct Authority (FCA) prohibited from practicing on New Year’s Dayand since then insurers cannot charge new customers less than old customers.

However, shopping around for the best quote is still the best way to ensure you pay less for the acquisition.

How to reduce driving costs

Newell added: “We will be monitoring the impact of the new FCA measures in the coming months but the fact remains that shopping around is always the most effective way to keep your costs down.”

Many insurers raised interest rates for new customers shortly after the New Year’s Day regulations went into effect.

On December 31, 2021, The Mirror featured several citations for 35-year-old fictional driver Vauxhall Corsa.

The cheapest quote, from Hastings, costs just £628 a year.

The average of the five cheapest policies is £801.21.

But the same driver buying the same cover for the same car on New Year’s Day morning, 24 hours later, will pay at least £100 more.

The cheapest is £728.95 – over £100.95.

Did you manage to cut your car insurance? Let us know: mirror.money.saving@mirror.co.uk

The average of the five cheapest policies is £1,024.67 – an extra £223.46.

But the price hike on new car insurance policies isn’t a bad thing, as it could make buying insurance more transparent.

In the past, when auto insurance was purchased primarily on the basis of price, many insurers cut coverage from policies.

This makes the policies look cheaper, but actually reduces what they will pay for.

It also resulted in insurers charging less for primary car insurance, but charging more for ‘optional’ add-on coverage that was once included as standard, such as Replace lost key.

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https://www.mirror.co.uk/money/car-insurance-mistake-millions-make-26292161 Millions of car insurance mistakes are made every year that add £50 to the bill

Fry Electronics Team

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