Car insurance warning to millions of UK drivers who are being 'hit in pocket'

27 February 2024 , 10:41

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A mistake could be leaving you out of pocket (stock image) (Image: Getty Images)

Millions of drivers in the UK are making a mistake that is proving to be really costly - and you're probably not even aware you're making it.

When you purchase car insurance you'll likely shop around to see what the best deal is. But when that runs out, do you let it auto-renew or do you cancel and find a better deal? According to Go Compare, 10% of motorists, which equates to around four million people in the UK, let their annual policies auto-renew - and this is proving pricey.

Drivers in London are most guilty of letting their policies carry over, with around 16% making the mistake in the capital. So why do people do it? Is it laziness or forgetfulness?

Nearly half of motorists (40%) said they didn't cancel the agreement because their current insurer was the cheapest option. They found that staying with the same firm offered good value, so didn't see any reason to switch. It was mostly older drivers who stated this reason, accounting for about 49% of over 65s.

Around 23% of people said loyalty to the brand was a major factor in staying, while 15-20% claimed online banking was the main reason. They said it was too much hassle to cancel the monthly direct debit and starting a new one.

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However, it turns out shopping around for a deal could actually save you a lot of money, and experts are urging to make important checks before their policy runs out. If you leave it too late it could be too late to cancel, and shopping around will give you peace of mind.

Tom Banks, a car insurance spokesperson for Go.Compare, said: "With premiums still on the increase, it's now more important than ever to shop around at renewal. Insurance companies will change how they price for certain risks and, just because one insurance company was the right policy or cheapest for you last year, it doesn't mean it will be the same this year.

"Shopping around at renewal also remains one of the best ways to save on your insurance. Simply letting your insurance renew may seem like an easy option, but this could actually end up hitting you in the pocket in the event of making a claim - particularly if you haven't checked you still have the cover that you need or if there have been any changes from last year."

Ariane Sohrabi-Shiraz