Revealed: Motorists should bag a new insurance deal three weeks before renewal for HUGE savings and not leave it to the last minute
- Motorists switching insurance policies could save by moving earlier
- Data shows they could save £319 by switching 3 weeks before their renewal date
- The most expensive time of year to change policies is December
Drivers could save up to £319 on their car insurance if they switch policies three weeks before renewal date compared to switching on the day it expires, new data has revealed.
There are large fluctuations in the cost of insurance depending on when you switch policies, with the cost significantly increasing as drivers get closer to the end of their insurance term, according to research from Compare the Market.
For example, if motorists switch their policy on the day that it ends, the prices available could be significantly higher, at an average of £776, compared to £457 if they switch three weeks before.
The cost could then increase as they get closer to the day the policy ends, with an average of £493 two weeks before, £565 one week before and £677 the day before a policy expires and automatically renews.
Drivers could save £319 on insurance if they switch policies 3 weeks before their renewal date
Despite the significant savings on offer, the highest number of comparisons on Compare the Market comes on the day before and the day of a policy ending, accounting for 34 per cent of all enquiries.
After the week before a policy ends, this then significantly reduces to two per cent or less for the remaining time periods.
An analysis of premiums by month over the last eight years also shows that there is a significant disparity in insurance costs throughout the year.
The average premium in December over the last eight years is £61 higher than the average premium for the rest of the year.
Throughout the year, the price of insurance tends to steadily increase before peaking in December and dropping again in January.
Whilst there are several reasons for this, the wide fluctuations in premiums demonstrate there are large savings on offer for savvy people looking to save more money on their bills.
Most motorists change their car insurance policy the day their current one is due to renew
Dan Hutson, head of motor insurance at Compare the Market, said: ‘The cost of car insurance varies at different points of the year and this is something that people should bear in mind when looking to renew their policy.
‘There are many reasons for this, including that the cost of a policy reflects the level of demand in the market at any given moment, along with a range of factors based on a person’s risk profile.
‘In December, people may be thinking about car insurance less, and so some insurers could charge higher prices based on this reduced demand.
‘The cost of car insurance then drops significantly in January as insurers compete to attract customers as they start to look at their bills after the Christmas break.
Those renewing their car insurance policies in December are paying more than other months
‘The same goes for switching providers around the end of a policy. The majority of people leave it until the very last minute to renew their policy, but our research shows that there is money to be saved through considering the time that you switch.
‘Shopping around remains by far the best way to save money on insurance, but these statistics prove that this saving can be increased even further by timing policy switches correctly.’
Motorists are encouraged to compare car insurance policy prices online, rather than sticking with their current plan, as they could save themselves hundreds of pounds each year.
Drivers could also contact their insurer directly to try and negotiate a cheaper deal without moving provider.