Why Loyalty to Car Insurer Could be Increasing Your Premiums


author image - crispin

By Crispin Bateman

on Monday 11 March 2019


Simple diagram showing an increase in car insurance premiums

It’s easy isn’t it – let the car insurance just do its thing once you’ve set it up. Forget about it and they’ll send you a letter at some point near your renewal date and either you’ll call, or they might even automatically renew for you. No worries, no hassle.

Only it could be costing you hundreds!

Loyalty to your car insurer is great for your car insurance provider. There’s less paperwork, less hassle and they don’t have to entice you with a cheap introductory offer like all those other people.

But this also means that they can do away with giving you the best offer and just give you enough to keep you on board.

In fact – those cheap introductory offers are probably being paid for with the little extra that they are making off your insurance loyalty!

Shop around – the first thought in lower car insurance premiums

You’ve heard it a thousand times – don’t take the first offer, shop around. When you first got your insurance, you read those articles on how much you could save if you shop around so why is it any different when you get to your renewal?

Often, the insurance renewal is more expensive than a new quote! Don’t make the same mistake that you managed to avoid in the early days.

Insurance is a competitive business, so take advantage of that and play insurers against each other. Sure, it can mean an hour or more lost on the phone, but for a hundred pounds or more saved, isn’t it worth it?

Does my insurer provide loyalty discounts? How can I lower my car insurance renewal but keep my insurer?

Don’t just accept the first offer they give you when you call to renew. Ask them if they are giving you a loyalty discount and explain that you are going to shop around and see if anyone can beat their quote. You might just get to hear them scrabble around and find just the right offer to keep you! After all, they don’t want to lose you now any more than they did when they first convinced you to choose them.

Be honest – tell them you want to reduce your car insurance and that you’re willing to spend some time making sure that happens!

Check your renewal date and act at the right time

It’s all about risk! Recent data suggests that the peak time to renew your car insurance is 21 days before it is due. Why? Because insurance companies are very good with their analysis and they have worked out that people who leave their renewal to the last minute are more of a risk than those who are prepared weeks in advance.

And your premiums are based entirely on your level of risk!

So, if you do nothing and let your renewal just happen, you are showing them you are a riskier proposition. It may sound incredible, but it’s true! Lower your premiums by acting three-weeks ahead of time and give them a call at exactly the right moment (too early and your policy won’t count as needing a renewal!).

What other tips are there for lowering my insurance premium?

Here at Compare UK Quotes we are full of advice! For more tips on lowering your insurance premium, read our library of articles on the subject. From black box insurance to getting the right level of cover for your motorhome, we have it all!

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motor insurance money management personal finance cars advice Car Insurance