We all like a bargain and insuring your car should be no different. But thousands of motorists pay more than they should every year by simply renewing with their existing insurer rather than shopping around first.
Whilst shopping around is a crucial step to bagging a good deal it's also important not to take special offers such as multi-car policies and 52 days' free insurance for granted.
Research by online insurer Swiftcover car insurance has shown that many offers are not as special as they appear to be, with drivers still paying too much for their cover.
For example, Swiftcover found that:
- Admiral's multi-car policy costs £283 more than Swiftcover when insuring a Ford Fiesta and a Ford Mondeo. Two policies with Swiftcover would cost a total of £392 compared to £675.48 for Admiral's multi-car cover.
- Direct Line's 52 days recent free insurance special offer is still £110 more than Swiftcover when insuring a Ford Mondeo. Again, a policy with Swiftcover would cost £185 compared to £295 with Direct Line.
Swiftcover has seen sales of it's low-cost motor insurance grow by 31% since the start of 2009 as more and more motorists start to search for cheaper cover online. But whilst the number of motorists making the effort to shop around appears to be growing, consumers should be careful not to be tempted by deals that actually don't save them money.
Marketing director of swiftcover.com, Tina Shortle, commented... "Competition in the motor insurance market is fierce at the moment, with many companies offering so-called 'special offers' to entice customers. However, these deals can confuse motorists as to the true costs and potential savings of their insurance."
Swiftcover's warning forms part of the insurer's credit crunch tips for saving money on your insurance premium.
- Always compare quotes - Don't just accept the renewal price from your existing insurer, it's unlikely to be the cheapest. Use at least one comparison website and get quotes direct from a couple of insurers for maximum comparison
- Beware of 'special offers' - 52 days' free cover might sound like a great deal, but if the insurer is expensive in the first place, you might not be better off. No matter how good the offer seems, always shop around.
- Don't assume that multicar policies are cheaper - Multi-buy deals might save you money at the supermarket, but it's not always the case with car insurance. Swiftcover.com found that drivers could save more by choosing separate motor policies.
- Shrink your car, not your cover - If you're downsizing to a smaller car to save money, don't cancel your policy as you could be out of pocket due to cancellation fees. For example, switching from a Ford Mondeo to a Fiesta and sticking with an existing Swiftcover policy could save you £1113* compared to cancelling.
- Save the environment and save money - Swiftcover encourages motorists to be more environmentally friendly by giving a 10% discount on insurance for greener cars such as the Toyota Prius.
- Combine policies - You might be able to lower your insurance costs by adding your spouse to your own policy instead of both having separate cover. Again, it's important to compare quotes to see which offers the best deal for you.
- Don't drive without cover - 150,000 uninsured vehicles are seized every year, so being caught could result in a £1,000 fine, a driving ban and your car being crushed.
- Think about your voluntary excess - Opting for a higher voluntary excess could reduce your premium, but if you make a claim, you will have to pay the excess out of your own pocket. Also, don't forget you will also have to pay the compulsory excess in addition so the total excess costs can all add up. Therefore, choose a voluntary excess that you can afford to pay in the event of a claim
- Don't pay for cover you don't need - Some policies include extra's that you might not need, such as overseas cover for example. Read the small print and if you're not sure what certain features are, ask to have them removed from your policy if they don't offer any benefit to you.
- Look after you motor - Keeping you car in good condition can save you money in the long term. For example, a chip in a windscreen can often be repaired for free on most policies, whereas replacing the entire glass will cost you your windscreen excess.