Martin Lewis urges drivers to ‘fight back’ as car insurance rates rise

Martin Lewis has urged motorists to “fight back” against rising car insurance rates as car owners claim they are being “held to ransom” with astronomical quotes.

The founder of MoneySavingExpert said car insurance is about the “risk books of millions of drivers” who are “in different scenarios”.

It comes after Independent exclusively revealed average premiums rose an average of 48 per cent in the 12 months to June 2023, according to data from analyst Consumer Intelligence, which looked at quotes from Confused.com, Go Compare, Compare the Market and MoneySuperMarket.

According to Consumer Intelligence, people ages 25 to 39 and 65 and older were hit hardest by the auto insurance hikes, with average premiums jumping more than 50 percent.

Drivers in Scotland and London saw the biggest increases in premiums.

“It’s Ransom”

Andrea Klein, 60, said drivers were being “held to ransom” after seeing her insurance quotes jump more than 90 per cent.

“I’m a very discerning consumer and I know how to compare like with like,” said the part-time carer from London The Independent. “But there’s no rhyme or reason to what insurance companies do.”

Ms. Klein has had a no-claims bonus for more than a decade on her 13-year-old Toyota Prius. However, she has seen her rate double from £368.58 to £722 with 1st Central.

Some offers were as high as £2,000 on comparison websites, she said.

While the 60-year-old considers whether she can afford to keep her car on the road, her job as a part-time carer means she relies heavily on her car.

“We pay taxes, fuel taxes and we have no choice but to insure the car. At least we should be allowed to insure at a market rate.

Andrea Klein said drivers are being “held to ransom” for owning a car

(Delivered)

As a recent divorcee, Ms. Klein said the premium jump hit her hard.

“Trying to make ends meet has now become more difficult. At a time when I’m counting my pennies, I don’t have room for that in my budget,” she said.

“Huge kick in the teeth”

Scott Young, from Welling, said his insurance renewal increased by 69 per cent from £587 to £993.78 with Hastings Direct.

The 34-year-old was driving a 2018 Toyota RAV4 and his wife was a co-driver.

“We both work full-time and have six kids,” he said. “It’s a huge kick in the teeth for the hard-working in society.

“It’s really ridiculous that insurance companies can charge this when insurance is literally a necessity if you own a car.”

John Williams has expressed his frustration, saying his premiums for the 1.2 Micra (2009) have risen from £150 to £420 with the Saga, despite having had “no incidents or claims”.

“I don’t understand how car insurance companies can justify these huge increases,” he said, adding: “We have nowhere to turn for help.”

What does Martin Lewis say?

Speaking on the BBC Sounds podcast, Mr Lewis said: “It’s all art, not science. It’s all trial and error,” as he encouraged car owners to try different combinations as long as they stayed within the law.

The money mogul also said, “Timing is everything.”

“When you get your insurance quotes matters. How many days before your renewal expires affects the price you’ll be quoted.”

Mr Lewis said the optimal time to get a quote is 21 days before your renewal is due, while the most expensive time is on the day of your renewal.

He explained: “What the insurer’s risk tables show is that the type of people who leave it until the last minute to get quotes on their insurance are at higher risk than the type of people who don’t.”

The MSE team give nine tips on how to get cheaper quotes, from paying annually to checking if you can add a responsible driver to your policy.

You can listen to Mr Lewis’ podcast on BBC Sounds here where he gives more tips on how to save money on car insurance quotes.

Toby van der Meer, chief executive of Hastings Direct, said: “Unfortunately, car insurance prices are rising across the country as more people drive and the average cost of claims rises rapidly.

“We would urge everyone to check their renewal details, including mileage and cover levels, and make sure they are happy with them and therefore not overpaying.”

Saga said: “In line with other insurers, we are experiencing high levels of claims inflation, which in turn means premium and renewal prices have unfortunately also had to rise. This is particularly evident in the auto insurance market.

“To use auto insurance as an example, material shortages have caused certain replacement parts to become more expensive due to demand. Not only that, but they also take longer to arrive, which extends the length of time that cars are idle after a claim, and then extends the time (and therefore increases the cost) that claimants need a courtesy car.

“As reported by Trend-Tracker, industry data revealed that we are seeing a doubling of turnkey times from around 34 days to over 65 days, with no current signs of this slowing down in the near future.”

“Saga fully supports and complies with the market reforms introduced by the FCA last year. This means our existing customers pay no more than new customers when renewing.”

Speaker of 1St central said:We work hard to keep the cost of car insurance as low as possible for our customers.

“There are many factors that determine the cost of insurance, including individual circumstances, repair costs, parts supply and the used car market. The insurance industry has seen a significant increase in these costs in recent months, resulting in higher average premiums across the sector.”

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