HAGGLING PAYS FOR ONE IN FIVE DRIVERS
- Average car insurance premiums rise 13.5% to £788 in a year
- Motorists need to shop around as Insurance Premium Tax increases from October 1st
Haggling pays for one in five drivers faced with increases on their motor insurance, new research from insurance experts Consumer Intelligence demonstrates.
Annual premiums are accelerating by 13.5% taking average prices to £788, Consumer Intelligence’s Car Insurance Index1, which the Government’s Office of National Statistics uses to calculate official inflation statistics, shows.
The latest rise in Insurance Premium Tax to 10% – which took effect on October 1st – is adding to the pressure on premiums but it is possible for drivers to minimise the impact by haggling and shopping around, Consumer Intelligence’s data shows. It found that 20% of drivers who stayed with their insurers after renewal are offered lower prices, often with their insurer matching the best quote from rivals.
Ian Hughes, Chief Executive of Consumer Intelligence said: “Haggling with insurers clearly pays as drivers who make the effort to negotiate are finding. Insurers are generally receptive to renewal premiums being queried and will offer reductions to try and keep customers. It’s always cheaper to keep a customer than find a new one. When premiums are rising and other people are haggling successfully there really is no excuse for not haggling or shopping around.”
Its research shows not all prices are going up – around 25% of customers who stayed with their insurer say they were offered lower premiums while 15% who stayed with their insurer said the savings elsewhere were not worth moving for.
Consumer Intelligence’s Car Insurance Index shows younger drivers are paying the highest bills – average premiums for under-25s are £1,831 although prices are rising slightly slower than average at 9.4%.
Older drivers are seeing higher price rises at 15.3% but their average annual bill as calculated by the five cheapest premiums is just £348.
Younger drivers are seeing some benefit from telematics – so-called black box technology – which rewards safer driving with lower prices. Around 55% of the most competitive premiums for under-25s come from telematics policies. Just 8% of the best deals for those aged 25-49 come from telematics.
1 The cheapest premiums were calculated by comparing the prices offered for 3,600 people by all the major Price Comparison Sites and key direct insurers. The top 5 prices for each person were compared to the previous month’s top 5, then these variations averaged to produce the index
About Consumer Intelligence
Consumer Intelligence (CI) is a market research agency specialising in the General Insurance and Banking Sectors. We have spent the last 12 years perfecting the art of collecting data so that organisations can benchmark themselves. Since 2003, we have been collecting and analysing millions of prices across the telephone, direct insurer websites and aggregator channels. For more information, visit the web site http://www.consumerintelligence.com
Press release distributed by Kevan Reilly, Citigate Dewe Rogerson
6th October 2016