Recession drives motorists to car insurance bargains

Thursday, 02 July 2009 09:38

Brits are comparing more car insurance policies that ever before, according to new market research.

A study by Mintel finds only 23 per cent of drivers are staying with their existing car insurance provider - down from 31 per cent who stayed put eight years ago.

Some 77 per cent of drivers shop around before buying car insurance and 45 per cent take up to three quotes.

Some 16 per cent take seven or more quotes - with the under 34s most likely to shop around most.

Meanwhile over a third of over-55s have held their policy with the same insurance company for over five years.

Toby Clark, head of financial services at Mintel said: "Today's consumers are growing increasingly disloyal and are extremely price sensitive."

A total of 49 per cent of motorists buy car insurance directly from an insurer, two-fifths use a broker or comparison websites.

But the number of people using brokers has fallen steadily recently as the number of comparison sites - or aggregators - has grown.

"The fact that half of people who use price comparison sites switched their car insurance provider within a year of taking the policy out demonstrates just how aggregators encourage this sort of switcher mentality," said Mr Clark.

"By comparison, just 15 per cent of people who sourced their cover direct from an insurance company changed their policy after just one year."

Simon Douglas, director of AA Insurance, explained as customers look to get the best deals, they should not forget to think about the cover they are buying.

"It is important that buyers don't confuse the 'cheapest' premium with 'savvy' buying: the best value for money isn't necessarily the cheapest," he said.

"It's important to compare benefits and excesses - if you have to make a claim, that's the wrong time to discover that your insurance doesn't provide the level of cover you expect."

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