Beleaguered Drivers Downsize on Car Choice as Rising Motoring Costs Take Their Toll

CHESTER, England, July 25, 2011 /PRNewswire/ --

• Half of motorists plan to swap to a more fuel efficient car
• Shopping around at renewal time is crucial - motorists can save £319 a year on average

Two thirds of motorists (65 per cent)^[1] admit record fuel prices coupled with the rising cost of car insurance will impact their choice when it comes to purchasing their next vehicle, according to new research from moneysupermarket.com.

Britain's number one comparison site found drivers are facing tough decisions when it comes to their finances, with many looking at changing the car they choose to drive as a way to cut costs. Over half (55 per cent) say they will choose a more fuel efficient model next time, and more than a third (38 per cent) will look to purchase a vehicle that is cheaper to insure or that has a lower road tax. Almost one million motorists^[2] stated they would sell their car altogether.

Pete Harrison, car insurance expert at moneysupermarket.com, commented: "It is not surprising so many motorists are rethinking their vehicle choice given escalating fuel and insurance costs. Our analysis shows car insurance prices increased by 31 per cent in 2010^[2], and we have seen similar rises in 2011. This, coupled with rising fuel costs, iscreating extra pressure on household spending, and forcing many families to rethink their motoring needs.

"Looking for ways to cut costs is a priority and drivers can find ways to help ease the cost of running a vehicle.  Reducing fuel consumption through car sharing, avoiding using the car for short journeys and driving more efficiently are ways motorists can help to reduce the impact of spiralling fuel costs. It is also crucial drivers shop around to find the best deal on their insurance policy as they could save themselves over £319 by not accepting their renewal quote and looking elsewhere - helping to mitigate some of the impact of rising motoring costs."

moneysupermarket.com's top tips for lowering the cost of your car insurance:

Pay annually rather than monthly: Although annual payments require a larger initial outlay, in most cases the total cost over a year works out cheaper than monthly payments. Many insurance companies charge interest if you choose to pay monthly which can further increase the overall cost of your policy. If you cannot afford to pay for your insurance in one lump sum, consider using a 0 per cent purchase credit card and fund the premium on this. However, make sure you pay off the balance within the promotional period or 12 months whichever comes first.

Reduce your annual mileage: the more miles you drive, the more time you spend on the road and the more likely you are to have an accident. Reducing your annual mileage will bring down the cost of your premiums.

Notify change of job: Renewal quotes are based on that same mileage figure, so if you change your job or other circumstances mean you travel more or less than previously, you should always mention this to your insurer. If you can show your insurer that your usage has reduced then this can result in a lower quote.

Vehicle Security: the more secure your vehicle, the less likely it is to be stolen, and the less likely your insurer is to have to process a claim. As such, car insurance companies will reward you for fitting things like an alarm and immobiliser if your car does not already have them. Check with your company to see what will decrease your premium the most, as some security fittings can be quite expensive - you want to make sure the outlay is countered by the saving on your cover. Where you park your vehicle is also important - garaging a car will reduce your premiums - but make sure you do actually use it otherwise any subsequent claim could be turned down if you don't.

Driving behaviour: being caught speeding or committing other traffic offenses will increase the cost of your car insurance, or even jeopardise your chances of obtaining cover at all. The closer to the letter of the law you drive, the better - both financially and in terms of safety for yourself and others.

Modifications: if you modify your car in any way, you should tell your insurer. Performance or style modifications will always increase your premium - if you are searching for cheap car insurance you should keep any changes to a minimum.

Main Driver: if a car in the house is shared equally, but one driver has significantly more experience or fewer penalty points, naming them as the main driver (with you as a named driver) can save you money on your car insurance. 

 

Notes to Editors:

^[1] Research undertaken by Opinium Research based on poll of 2,030 British adults carried out May 28 - 31 2011.

^[2] 33 million drivers in the UK (Department for Transport 2006 figures). 3% stated they would sell their car = 990,000

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SOURCE moneysupermarket.com