Warning re the cost of automatically renewing your car insurance

Gocompare.com’s Car Insurance Auto-Renewal Survey shows that nearly 6 million motorists a year fall into the auto-renewal trap by simply allowing their car insurance to automatically renew without checking other quotes first.

September is traditionally one of the busiest months for car insurance renewals due to the high volume of new car sales. However, the new survey shows that many drivers are likely to fall in the auto-renewal trap.  Worryingly, 18% say they allowed their car insurer to automatically roll-over their policy for another year at their last renewal – without checking whether they were being offered a good deal.

The survey also revealed that on average, drivers have been with their current insurer for 3.3 years, but a 16% have stuck with the same provider for five years or more.  However, many of those surveyed don’t feel insurance companies reward them for their loyalty, 58% think that insurers offer a better deal to new customers than those who renew.

When asked why they allowed their car insurance to renew automatically 39% thought that because their provider was the cheapest last year, they would be good value this time around too.  Other reasons for sticking with the same provider included loyalty (24%), a good experience with a past claim (11%) while 5% said that they weren’t confident enough to switch, finding car insurance too confusing.

A spokesman for the company commented: “New registration plates are issued in March and September, making them the busiest months for car insurance quotes and renewals.  The car insurance market is fiercely competitive and insurers often offer better deals to new customers than for those renewing existing policies.

“So, our advice is simple – even if your current insurer offered the best deal last year, you shouldn’t automatically assume that they will when your policy comes up for renewal.  Use your renewal letter as a prompt to take action.  Look at your renewal notice as soon as it arrives.  Compare the price and cover against last year’s documents, consider any changes you might need to make to the cover and take a look at similar policies on a comparison site to see if you can make any savings.

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