Don’t pay for car insurance loyalty

When it comes to car insurance, most customers feel a sense of loyalty towards their providers. As long as they give us a suitable pay-out in the event of a claim we’re happy to stick by them year in and year out.

Yet many car insurers increase premiums on an annual basis, while others offer introductory rates that only apply to new customers. According to a survey by Tesco Finance, 68 per cent of motorists could save on their car insurance premiums by switching to a different provider.

The same survey revealed that only 32 per cent of respondents have changed their car insurance provider in the last year, while 10 per cent stated that they have never moved or have held their existing policy for more than a decade.

So why, when there is money to be saved, do we stick with our existing deals?

The reasons for car insurance loyalty

One of the main reasons drivers choose to stick with their existing car insurance policy is that they are happy with the provider’s service. If that’s the case you might be willing to pay a little extra rather than take a chance on an unknown provider that offers cheap car insurance, but does not guarantee the same high standards.

For many drivers, coverage levels are valued more highly than price. It is important to find the level of cover that’s right for you and to examine an insurer’s policy thoroughly. However, this does not mean you should automatically pay over the odds for comprehensive cover. Many motorists could secure exactly the same levels of cover for less by shopping around.

Another reason for sticking by our existing providers is we assume the switching process is too complicated. However, it needn’t be. Whenever you receive a renewal reminder through the post, you should take this as a prompt to shop around. Many new car insurance deals can be established within a 24hr period – ensuring you are fully insured and ready to drive.

Perhaps the most disconcerting reason why we stand by our car insurance providers is that we simply can’t be bothered to search for a new deal. However, shopping around only takes two minutes – and the savings can be more than worth the effort.

How can you find cheaper car insurance?

Shopping around has been made simple by the explosion in popularity of car insurance comparison tools.

Previously customers had to contact individual providers directly or deal with brokers who would often take a heavy commission and had a limited panel of insurers on their books.

Now however, reputable price comparison websites allow you to gain a thorough overview of what’s on the market within minutes. The leading car insurance price comparison tools will return car insurance quotes from dozens of providers. It also won’t cost you anything to use its services and the quotes you will receive will be the same as those available directly from the insurers. In fact, some comparison tools retrieve quotes that are lower than those available on the insurers’ own websites as car insurance companies offer exclusive incentives to appear high in the comparison table.

Of course comparison tools might not include quotes from every car insurance provider. Consequently, if you want to be thorough and ensure you are receiving the cheapest car insurance quote available, you may wish to directly approach any providers that do not allow their quotes to be returned through comparison tools. Obviously this is a more time-consuming process.

Can you save money without changing providers?

The simple answer to this is ‘yes’ - but you will have to do some work.

Firstly, look for ways to reduce your risk level to the insurer. Enhancing the security of your vehicle, parking in a garage overnight and taking advanced driving courses will limit the chances of you making a claim in the insurer’s eyes - and therefore reduce your premiums.

Another tip is to use the price comparison tools to your advantage and search for the cheapest quote available on a like-for-like deal. Once you have found it, call your existing provider and tell them about the quote you’ve discovered. Ask the provider if it is willing to match the offer you received as you value its service and don’t want to change unless you have to. It may be willing to drop its prices accordingly.

Whether you want to change provider or not, don’t sit on an expensive car insurance policy. Shop around for cheap car insurance and search by manufacturer name, such as Ford car insurance, to make significant savings.