Why It's Always Best to Shop Around For a Car Insurance Quote
So I have a car, just like the majority of people around the world. And as a responsible, law abiding citizen I have to ensure I have me and my car insured so that if I am involved in an accident there will be funds to pay the other party if it's my fault. If I also want to cover the cost of damage to my own car I can upgrade my policy from third party, fire and theft to fully comprehensive.
I have a decent car, it's a 1.6 litre Hyundai Coupe. It's not really important what kind of car I have, I am just showing you that it's not a beast that means higher car insurance premiums.
My car is not that flashy and I actually got it on the 2nd hand car market for a really decent price. So I always take fully comprehensive car insurance for just in case anything happens. After all, that's basically all insurance is - Just in case sh*t happens!! If nothing happens then they don't pay you any money back for not claiming and you are still out of pocket for the amount you paid for that years car insurance.
I need my car and public transport is fairly decent, inner city, but once you get out of town it's pretty hopeless.
Are You in the High Risk Factor for Car Insurance?
Now I am slightly annoyed this year when it comes to my car insurance. I am not in any of the high risk factors for a car insurer. In fact, I am probably in the low risk category.
High risk category would be a young male. Young males are deemed higher risk because they tend to get caught up in the action. They are more prone to street race, drink and drive or want to impress their other young and impressionable friends. Of course not all males below the age of 21 are like this but insurance companies paint a broad brush because they don't know you as an individual. They base their prices off statistics and therefore you are just a number.
I, on the other hand, am over 25. I am female so that removes the testosterone and I have never had any accidents, speeding tickets or driving convictions. I have never made a single car insurance claim in my life and have my full no claims bonus. I did not change my address or my car. I did not upgrade my car or make alterations to the performance of my car. So why was it that when I got this years insurance quote from my insurer the price had increased by over £100??
Don't Believe Everything Your Car Insurance Company Tells You
As a rational and logical person, I called my insurer to check that there wasn't some kind of error. I was calm and polite and they ran through all my details. When the call operator couldn't find any discernable reason why my quote would increase by almost 35% I was told that "rates of insurance have gone up nationwide" and basically that I had to live it. Of course I was furious.
I, as an individual, had done nothing wrong yet I was being punished. I am a bit of a sceptic and I had never heard of this before. I had heard that there was a new insurance premium that was being applied to car insurance but nothing that should amount to 35% surely.
This insurance premium was put in place because of the number of accidents involving none insured drivers.
Does it Pay to go Through an Insurance Broker Online
While I discussed the issue with my current insurer, I was sitting in front of my computer. I went to moneysupermarket.com, which is a site that acts like a broker. You put your details in once and they run your application through all the applicable insurance companies that suit your application and then bring you back the prices of a large number of insurers. This way you don't have to complete lots of forms to get the same result. Hopefully, you find a cheaper alternative than what you are being quoted elsewhere.
I had seem ads on the TV everywhere for these type of services saying they have saved customers £353 on their car insurance. I always found these adverts unbelievable and thought they must be exaggerating so had never used them before. I was only using it on this occassion to check that what my insurer was saying was true, as I didn't believe him. I was right to be sceptical.
Moneysupermarket returned a number of results and almost all of them were cheaper than my current car insurance, let alone my new increased premium. Some of these quotes were almost 50% off the price of my new premium. Of course, this make no sense to me because if the reason is that insurance premiums have increased nationwide, how come these other insurers are able to offer me such a low price?
Can You Really Trust Your Car Insurance Company?
When I told my current insurer the prices I had been quoted he didn't sound surprised at all. He quickly changed tact and started to throw discounts at me. Yet he still couldn't manage to bring my premium close to the new quotes I had found. Yet if I hadn't called I would have been stuck with full price and would never have been offered any discounts or the free roadside breakdown and assistance that was also thrown in for free!!
How can you trust that you're insurance company will do the right thing when you actually need to use them, if they try to stiff you from the minute they quote you?
Loyalty No Longer Counts
The moral of the story is it no longer pays to be loyal to a company. From my personal experience it is clear that more often than not existing customers don't get the best offers or discounts. Companies send you out the bill at full price hoping that you won't question you're renewal and just be lazy. This way they make more off their existing customers while bringing in more new customers that they plan to implement the same strategy on next year, at their renewal date.
Insurance Brokers Can Save You Money
I was always taught that it's best to go direct to a company and get a price for them. I was specifically taught that going through an intermediary was more expensive as you are "paying the middleman". I can think of a few examples such as buying a second hand car. If you buy it from a car dealer it's more expensive that if you had bought it directly from the previous owner. If you go through a travel agent to buy plane tickets, it's almost always more expensive than going straight to the airlines. However, in this case going through a broker was cheaper, reduced my time searching for the right quote and stopped me from paying ridiculous prices for car insurance.