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Car Insurance Gearing Up To Drive Down Costs
By: Rich Green
For once finances seem to be going in favour of the UK motorist, with Esure
(http://www.esure.com/) announcing plans to double its share of the UK's car
insurance market - a move which is likely to spark a price war, other
internet-only direct insurers passing on to consumers savings based on their low
overheads, and specialist insurers offering reduced rates for their particular
target markets. A trial pay-as-you-go scheme from Norwich Union
(http://www.norwichunion.com ) is also creating a lot of interest for money
conscious motorists.
The pay-as-you-go scheme uses a small box costing an initial £199 which is
fitted in the driver’s boot, to record when and for how long a driver actually
uses their car. The box stays in contact with a satellite which is sent regular
updates of the journey data stored on the box, tracking the vehicle and then
delivering the information to the insurer. The driver is then charged based upon
how far at what time they used their vehicle.
“We got a statement”, said one member of the trial, "which showed what mileage
we had done, and on what days of the week, as well as if we had been driving in
the evenings or peak hours."
For low mileage users, this system could present significant reductions in
premiums, for higher mileage drivers searching about for the best deals at
renewal time is an absolute must. Unfortunately, last year five million
motorists failed to shop around, missing out on an average premium saving of
£180. Shopping around becomes especially important for anyone coming to the end
of a free insurance offer on a dealership car and should not simply take the
quote offered by the manufacturer's insurer, as significant savings can be made
by shopping around. Comparisons sites such as Moneynet ( http://moneynet.co.uk
)enable consumers to quickly look at hundreds of insurance providers in one go,
making it easy to find the best deals that are available, and they often have
their own extra discounts which are provided through their own sites.
While the government tries to work out new ways to extract more money from
motorists, the competitiveness of the insurance industry is thankfully helping
to drive down the cost of insurance premiums, making it one of the few rays of
hope for UK drivers.
About the Author:
Richard works in Edinburgh for a media company, occasionally writing for the personal finance blog Cashzilla ( http://cashzilla.blogspot.com/ ), and drinking
too much coffee. |
