Paying monthly for car insurance costs more

car insurance monthly

With motoring costs soaring, petrol now £478 more expensive than a year ago and with car insurance up four per cent, drivers are missing out on savings by paying monthly. The average annual car insurance policy now stands at £459.44, but is £506.76 for those paying monthly.

This equates to car insurance firms charging annual interest 23.8 per cent, compared to the current personal loan best buy of 6.9 per cent, according to data from uSwitch.com. For many motorists, spreading the cost of car insurance over 10 to 12 months makes the policy appear more manageable.

Ashton Berkhauer, insurance expert at uSwitch, said: “As insurance costs, petrol prices and general living expenses are soaring, motorists should think twice before agreeing to monthly payments on their car insurance. “Some insurance firms, such as Virgin, do not charge for monthly instalments, while paying for insurance by using a 0% offer on a credit card could also keep down costs.

The insurance expect has also issued some tips for getting cheaper car insurance premiums:

Always shop around to ensure you are getting the best deal on your car insurance policy. If possible pay the full amount of your insurance up front to avoid paying unnecessary charges. If you can’t afford to pay the full amount of you car insurance up front check your insurer’s APR and shop around for a more competitive alternative or look at 0% credit cards.

Car Loans – Save On Insurance

Bear in mind that it is possible to save a lot of money on insurance when you apply for an auto loan to purchase a car or other vehicle.Insurance is a must, it is illegal in most places to drive without insurance. Insurance protects both you and everybody else if there is an accident. However, there are different insurances that cover different things and you may do well with a simpler insurance that can cost you a lot less money.

Importance Of Credit Score On Car Insurance

Insurance companies also take into account your credit score in order to decide whether they’ll grant you insurance and how much they’ll charge you for it. Thus, it is important for you to keep a sound credit score if you want to save money on interests on your car loan but also if you want to save money by paying less on your insurance fees.

Though there is a lot of debate going around whether it is fair to make credit score a variable when rating insurances, truth is that the issuers take credit score into account and if you can show a higher credit score, you’ll do a lot better.

Many insurance companies will provide you with discounts on your insurance premium if you meet certain requirements. If you’ve got a new car with all the corresponding safety devices like airbags, safety brakes, theft alarms, etc., you’ll be able to obtain a noteworthy discount on your insurance premium too as all these safety measures reduce the risk for the insurer.

Combining insurances is also a good idea. Also, if you take your car insurance with the same company that you took your home insurance or other insurances, you may be able to obtain a combo with important savings in terms of premiums.

Source : Totally Motor & Car Loans