It’s never wise to leave anything to the last minute (remember that old chestnut about ‘Don’t put off until tomorrow what you can do today?’), and this advice should definitely be heeded if you’re in the habit of leaving it until the 11th hour to arrange your car insurance.
That’s because, according to recent research, last minute motor insurance policy purchasing can set back UK drivers some £326 more (on average) than if they’d sorted it a few weeks in advance.
Apparently, it’s common practice amongst British motor insurers to raise premiums quoted to drivers who choose to wait until the last minute before applying for a policy, believe it or not.
Most drivers probably weren’t aware of the stark discrepancies between snapping up insurance three weeks before the policy is required to kick-in and the day itself, yet the potential variation in cost to the policyholder can be very significant.
Research suggests that insurance providers seize on the panic conveyed by last-minute buyers and financially exploit it by charging over the odds knowing that the individual’s existing cover deadline is imminent.
Conversely, by removing the hassle from the business of acquiring motor insurance (essentially by putting it in place roughly a month before the new policy start date), forward-thinkers will benefit by being offered cheaper premium options.
Indeed, the acknowledged most cost-effective time to sought out cover is precisely three weeks beforehand.
That’s based on the assumption that insurers will have to provide competitive prices or risk drivers jumping ship and shopping around for more appealing bottom line figures.
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Car insurance price comparison website Compare The Market made the discovery about premiums peaking on the actual day drivers’ current policies expire (or automatically renew), and ultimately found that premiums negotiated/renegotiated at this pivotal juncture set the driver back on average £685.95.
The study confirmed that some 38% of UK car owners wait until the very last moment to do the deal too, meaning that car insurers are perpetually cashing in.
In contrast, a mere 1.5% dotted the ‘i’s’ and crossed the ‘t’s’ at that crucial three-week window of vastly improved opportunity, when the average cost is said to be £359.40; subsequently optimising an eye-watering £326.55 monetary difference between the price paid by the more organised parties and their more lackadaisical counterparts.
Although motor insurance policies across the board have risen in recent times due in part to the introduction of the much-flaunted IPT rate increase, the start of the calendar year is traditionally seen as a relatively affordable time to sort our car insurances, as the providers tend to offer more customer-friendly quotes right now to entice those who use the first couple of months of a new year to get their financial house in order.
Highlighting figures made available by Compare The Market’s study, the average premium in November 2015 was £567.90, an increase of almost £100 from a year earlier, while prices are universally believed to be at their highest in December, with the average premium costing £600.73 in the run-up to Christmas just gone.