Motorists Burn £1.9 Billion A Year By 'Auto Renewing' Their Car Insurance

13th May 2014

- 8.6 million drivers risk missing out on savings by sticking with their existing insurer when renewing

- 2.4 million motorists can't be bothered to shop around for cover

- Motorists could save up to £220 a year each by switching

UK motorists are wasting £1.9 billion each year by staying loyal to their existing car insurer. Not shopping around for a better deal at renewal time means drivers could be throwing away around £220 a year1, says MoneySuperMarket.com.

Britain's number one comparison site reveals 8.6 million drivers (23 per cent) automatically renew their car insurance with their existing provider.2 Of these, 13 per cent don't think they could save money by shopping around, and worryingly a further seven per cent (2.4 million motorists) 'automatically renew' because they can't be bothered to seek out a saving. Only four per cent of drivers renew automatically to ensure they comply with legislation on Continuous Insurance Enforcement (CIE).3

Many motorists assume shopping around for car insurance once is enough: one in five (18 per cent) admit they have only looked for a better deal once, as they didn't think they could make another saving the following year. London-based drivers are most likely to fall into this trap, with 31 per cent admitting they thought that way.

Kevin Pratt, car insurance expert at MoneySuperMarket, said: “It's a shame to see so many drivers blindly accept their insurance provider's renewal quote instead of taking action to save cash on their cover. Motorists don't even need to 'drive' a hard bargain. Average premium quotations are up to £220 less for those who shop around. It really pays to not just accept the renewal price quoted by your existing car insurer.”

Loyalty isn't rewarded

On average motorists remain faithful to the same insurer for two and a half (2.5) years, with the over 55s being the most loyal age group (averaging 3.2 years with the same insurer), compared to 1.9 years for drivers aged 18-34 and 2.1 years for those aged 35-54. Female drivers are more likely to switch insurer, averaging two years with the same one, compared to three years for male drivers. Regionally, London drivers are most likely to automatically renew their car insurance policies (39 per cent), and those living in the East Midlands are the savviest motorists, with only 15 per cent staying loyal to their existing insurer.

Kevin Pratt continued: “No matter where you live or what age you are, it's crucial to shop around at renewal time, as searching for a better deal doesn't cost you anything and there is a whole lot to gain. Even if your renewal is less than last year's price, in a market where the cost of insurance is falling there should be even cheaper deals to be so it's really worth checking if there is a better value policy out there to suit your individual needs. With a potential saving in the region of £200 it's surely worth five minutes of anybody's time?”


[1] Motor: '51% of consumers could save up to £ 220', Legal: Consumer Intelligence Feb 2014 or 'Consumers could save £220', Legal: 51% consumers, Consumer Intelligence Feb 2014

According to the ONS there are 50,371,000 adults (18+) in the United Kingdom in 2013. According to the research 74 per cent of UK adults (18+) drive some form of vehicle, therefore there are approximately 37,451,492 (37 million adult drivers in the United Kingdom).

23 per cent of respondents automatically renew their car insurance with their existing provider

23 per cent of 37,451,492 drivers = 8,596,249 drivers

8,596,249 x £220 = £1,891,174,671 drivers (1.9 billion)

7 per cent of motorists automatically renew with current provider and don't bother to shop around

7 per cent of 37,451,492 drivers = 2,438,117 drivers (2.4 million)

[2] Opinium Research carried out an online survey of 2,004 UK adults aged 18+ from 18th to 21st February 2014. Results have been weighted to nationally representative criteria.

www.opinium.co.uk

[3] In a bid to protect motorists from uninsured drivers the Road Safety Act 2006 included Continuous Insurance Enforcement (CIE). This came into force during 2011 and means that anyone who is registered as an owner of a vehicle, which isn't registered as SORN (Statutory Off Road Notification), must have a valid car insurance for it or face a penalty.