British Motorists Burn £3.1 Billion on Automatic Car Insurance Renewals

News provided by

moneysupermarket.com

28 Aug, 2012, 17:00 BST

CHESTER, England, August 28, 2012 /PRNewswire/ --

  • Nearly eight million drivers stay with their existing provider at renewal time
  • 2.92 million motorists can't be bothered to see if they can save money on car insurance
  • Motorists could each save £404 a year by switching
  • Ford Fiesta and Vauxhall Corsa most popular 'new cars' searched for on MoneySupermarket

British motorists are throwing away £404 each or over £3.1 billion as a nation, by automatically renewing their car insurance policy with an existing provider rather than scouring the market for a better deal at renewal time, says MoneySupermarket.com.[1]

With the new '62' plate car registrations released this week, research from the UK's leading comparison site found nearly eight million motorists (21 per cent) automatically renew their car insurance with their existing provider, rather than shop around for a better deal. 11 per cent don't think they could save money, and a further eight per cent, or 2.92 million drivers,[2]can't be bothered to shop around to see if they can save money. Only two per cent of motorists automatically renew their insurance policy to comply with legislation on Continuous Insurance Enforcement (CIE).[3] This is despite research showing motorists can save £404 on average by scouring the market.

Pete Harrison, car insurance expert atMoneySupermarket, said: "With many families returning home from a well-deserved summer break, household budgets are likely to be strained, and its important people don't just accept the renewal price from their car insurance provider.

"Our research shows the importance of shopping around, and motorists could find they can save themselves a staggering £404 by doing so. There is no excuse for apathy when it comes to renewing your car insurance policy."

STAYING FAITHFUL OVER 55

The research found that on average motorists have stayed loyal to their current provider for just over two and a half years, with this figure increasing to over three years for the over 55s age group, and reducing to under two years of loyalty among 18-34s. Drivers in Wales are most likely to shop around for a better insurance deal as the average driver has been with their current insurer for just over two years.

Pete Harrison continued: "No matter where you live or how old you are, it's vital to do your homework at renewal time, as searching for a better deal doesn't cost you anything and there is a lot to gain. It takes about five minutes to check if there is a cheaper policy out there to suit your individual needs."

The MoneySupermarket.com research also revealed that the Ford Fiesta continues to be the most popular new car searched for on the site, followed closely by the Vauxhall Corsa.

Further research from MoneySupermarket analysed website traffic in relation to searchers 'window shopping' for insurance for a new car. Motorists looking for insurance in anticipation of the new '62' plate remained relatively high on the site compared to the new registration in March 2012, and significantly higher than last September's '61' plate. This - supports a continued year-on-year upturn in new car sales for September's new plate, following increased car sales in March ('12' plate). Industry data shows March 2012 had an increase in new cars bought, with almost 400,000 new vehicles registered (1.8 per cent up on March 2011); this followed a fall in new registrations in September 2011, 0.8 per cent down on 2010.[4]

Notes to editors:

[1]Average saving of £404 with MoneySupermarket.com when shopping for car insurance. Based on online independent research by Consumer Intelligence during 1st July 2012 to 31st July 2012.

Research undertaken by Opinium Research based on an online poll of 2,012 nationally representative UK adults, aged 18+ from 14th - 16th August 2012. Results have been weighted to nationally representative criteria. http://www.opiniumresearch.com.

According to the ONS there are 49,969,000 adults (18+) in the United Kingdom in 2012. According to the research 73 per cent of UK adults (18+) drive some form of vehicle, therefore there are approximately 36,477,370 (36.5 million adult drivers in the United Kingdom).

21 per cent of respondents automatically renew their car insurance with their existing provider. 21 per cent of 36,477,370 drivers = 7,660,248 drivers

7,660,248 x £404 = £3,094,740,192 (£3.1 billion)

[2]Eight per cent of respondents automatically renew their car insurance because they can't be bothered to shop around. Eight per cent of 36,477,370 = 2,918,190 or 2.92 million drivers

[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.

New car reg in September 2012 is '62' according to the DVLA.

http://www.dft.gov.uk/dvla/pressoffice/pressreleases/31052012.aspx

[4] SMMT data:

http://www.smmt.co.uk/2012/04/new-car-registrations-show-encouraging-growth-in-key-march-market/

http://www.smmt.co.uk/2011/10/new-car-registrations-stable-in-key-september-market/

MoneySupermarket.com compares (at 20th July 2012)

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SOURCE moneysupermarket.com