A Guide to Renewing Your Car Insurance

Renewal time for car insurance is often treated as an after-thought by motorists. Many of us nonchalantly accept the renewal quote we are given by our existing provider and lock ourselves in for another year or more. However, with a bit more thought drivers could potentially save £100s every year at renewal time.

Many motorists simply don’t know or understand how the renewal process works and of course insurance companies that want to retain our custom are going to do all they can to play down the process and make us think that accepting their quote (which typically includes an annual premium increase) is the best option.

So let’s take a look at the renewal process so you are well prepared to get yourself the best available deal.

How do car insurance renewals work?

Car insurance companies are obligated to inform you that your policy is coming to an end. Many customers sign rolling contracts meaning that their policies are automatically renewed annually if there is no attempt to switch providers. However, generally you will be asked to sign on for another year.

Typically, the systems employed by large car insurance providers trigger the renewal process which means you will usually be sent a set of renewal documents through the post around 15 days before your existing policy expires. This gives you time to correspond and update your policy.

At this point, if you plan to stick with your current provider, you should assess the cover levels available to you and see if there are any options you wish to add or remove – for example you may no longer want a courtesy car if you have a second vehicle in the household. In addition, you should ensure that all statements of fact are accurate – you are legally bound to be honest with an insurer and failure to do so will invalidate your policy. So consider whether you have changed address or job since your previous renewal and look at whether you have added security devices or modified your car, for example. Did you previously state that you parked in a garage at night but now park on a drive? All of these factors can make a difference to your car insurance premiums so you must be honest.

Don’t panic and think that because you are making several changes to a policy that you will be left without insurance because the policy will take time to process. In fact, many car insurers have developed a practice of incorporating a certificate of insurance into the renewal documents giving you extended cover – typically for a period of seven to 15 days.

Should you stick with the same car insurance provider?

Many drivers make the mistake of assuming that their existing insurer is their only option and that they should stick with it regardless of how much their renewal increases. In fact, you can change your policy every year – and it may be financially beneficial to do so.

Even if your current car insurance provider was the cheapest when you took a policy out, it does not mean it will be the cheapest at renewal time even if you haven’t made a claim. That’s because insurers typically bump up premiums for existing customers year on year while offering better deals and attractive discounts to new customers. They realize that most customers stick with their existing policies on an annual basis and don’t bother to look at the market assuming that it is a time-consuming process.

The reality however, is that it needn’t be. Car insurance comparison websites make shopping around straightforward. They offer an online form which you fill out with details about yourself, your driving history and so on. You then click search and it will scan for quotes from nearly all the major providers - some comparison websites compare policies from more than 100 insurers with one search. The great thing is that these services cost you nothing - even though the insurers pay the comparison websites, your premium is not altered.

So using these tools can be very beneficial. You can find out quickly and easily if there is cheaper car insurance available compared to your existing quote. Even if you are completely satisfied with the service offered by your current car insurance provider there’s no reason not to compare car insurance online and speak to your current insurer about the quotes you have received elsewhere and ask it to match that offer.