Drivers face 10 per cent rises, says MoneyExpert.com
More than six million people chose to switch car insurance provider over the past six months in an effort to stave off rising car insurance costs, according to new research from MoneyExpert.com*.
The independent comparison website warns car insurers are expected to hike prices by up to 10 per cent this year because of rising claims and is urging motorists whose policy is expiring to look elsewhere before renewing with their current insurer.
The average premium for fully comprehensive insurance is currently around £682**, but MoneyExpert.com says that car insurers will still be able to offer new customers large discounts on premiums by hiking the cost of insurance for their existing customers.
The MoneyExpert.com figures show that 14 per cent of people have switched their car insurance provider in the past six months, equating to some 6.43 million drivers.
Sean Gardner, founder of MoneyExpert.com, said: "When it comes to car insurance, loyalty does not pay. The only way that car insurance companies can offer discounts and incentives to attract new business is by passing on the extra cost to their existing customers."
"Have you ever wondered why your renewal notice always seems to rise slightly compared to the competitive quote you got initially? It’s because you’re paying for someone else’s cheap deal."
"With over 35,000*** people switching car insurance provider every day it seems that the nation is catching on to the situation and voting with their feet. These days you can compare quotes in seconds online so no wonder millions are now taking advantage of the financial benefits of switching car insurance."
According to MoneyExpert.com middle aged drivers are most savvy, with some 17 per cent of 35-44 year olds claiming they have switched car insurance provider in the past six months.
Men are also slightly more likely than women to jump ship in favour of a cheaper deal, with 15 per cent of male drivers compared to 13 per cent of female drivers having switched since October last year.
Sean Gardner added: "While disposable income is being squeezed people need to make their money work as hard as possible for them. You could save up to 30 per cent off your car insurance by shopping around and that’s got to be worth having."
MoneyExpert.com says that regularly reviewing providers for a range of services is good practice but warns consumers that it might not always make financial sense to switch.
* Online Research carried out by YouGov who interviewed 2,051 GB adults (18+) between 28th and 30th April 2008. Grossed up using ONS statistics on no. of households and adults in Great Britain by Citigate Dewe Rogerson.
** AA Insurance Index
*** 6.432m switched in six months, divided by 6 months, divided by 30 days in a month = 35,733 people switching per day.