Cut the Cost of Car Insurance

Car insurance can be a major headache for a number of people, especially the young!

However, there is a cunning tactic which you can employ to save upwards of the region of 45% on the cost of your annual premium.

It all revolves around your renewal of the annual policy. Quite often – as in my case – renewal is automatic, if you pay by direct debit. I normally pay the entire annual premium on the date of renewal, as spreading the cost by virtue of monthly payments can incur additional costs, as they sometimes charge an interest for this service.

However, I digress, as the main message is that you should not renew with the same insurance company automatically year after year. Today, thanks to the internet and access to comparison sites such as ‘Go Compare’ and ‘Money Super Market’ – to name just two companies – you can shop around and compare prices.

A further icing on the cake comes from using a cash-back site such as ‘Top Cash-back’, where it does exactly what it says on the tin, and rewards you with a nice sum of cash, just for selecting a particular insurance company and using this useful web site.

Thanks to research by Martin Lewis and the good people at Moneysavingexpert.com they have discovered that the best time to grab yourself a bargain is to renew between 20 and 26 days before the renewal date falls. 

Without wishing to bore you to tears, the reason for this is, that the risk assesors at these companies have calculated – based on painstaking research – that those people who are sufficiently well organised to think about putting their car insurance, so to speak, in order, well in advance of the renewal date are considered less of a risk.

As a consequence, these consumers who pose less of a risk are subsequently rewarded with lower premiums. On the other hand, those who leave it until the last minute – which represents the vast majority, apparently – are very much considered high risk, and as a result have to fork out most.

In some instances, it is not uncommon for those well-organised folk to save up to 45% on the cost of their insurance, which can represent a saving of hundreds of pounds.

Therefore, I’m sure you’ll agree, it makes great economic sense to be well organised and sort out your car insurance well in advance of your renewal date. But remember, sorting it out 20 to 26 days before the renewal date will reap the maximum benefit.

Happy motoring!

Aled Evans