Renewing your car insurance early could save you hundreds of pounds, according to new research.
Insurance comparison site Compare the Market analysed renewal data and found that motorists saved an average of £306 by renewing 20 days before their current deal ends, compared with renewing on the day their policy finishes.
The data shows that the longer you wait to renew your policy the higher the price goes, with the average renewal on the final day of the policy being £707, while the average price 20 days earlier is £401.
The average price two weeks prior to renewal is £431, £506 one week before, and £617 the day before.
Despite this, Compare the Market says the highest number of quote comparisons take place the day before a policy ends, accounting for almost a third of quotes.
Ursula Gibbs, director of Compare the Market, said: “Insurance pricing can be complicated, and insurers use a wide array of factors to decide the cost of a policy.
“However, our figures clearly show that prices change significantly depending on when you choose to take out or renew a policy. Many people leave it until the last minute, but you can save a considerable amount of money by switching roughly three weeks before your policy is due to auto-renew.
“Shopping around remains one of the best ways to cut the cost of insurance, and these figures prove that this saving can be increased by more than £300 by timing a policy switch well.”
Other ways to reduce the cost of insurance is to get a quote early in the year, as insurers are more likely to be offering discounts. Compare the Market says prices tend to be lower in the first three months of the year, then steadily rise to a spike in December.
However, Gibbs warns that may not be the case this year: “While motor insurance has typically been cheap at the start of the year, 2022 could be different.
“With a major regulatory rule change fast approaching, the cost of insurance could increase significantly next year. If your policy is due to auto-renew in the next few weeks, you may be better off switching sooner rather than later.”
YesAuto/PA media
Keyword: Drivers save more on car insurance by renewing early, research suggests