Great Britain

Paying your car insurance up front instead of monthly can save £257 on your bill

COVER CHARGE

DRIVERS who pay for their car insurance up front instead of monthly could save hundreds on their bill.

Each year, Brits fork out £544million extra for their cover than they would by biting the bullet on a yearly plan.

A recent study by Go Compare revealed drivers who pay monthly are charged £55.36 more on average than those who opt for their annual policy.

Inexperienced motorists who choose to pay month-by-month can be forced to pay £257 extra for their cover.

Many insurers will often charge interest for motorists who choose to split their bills, adding between 6.8 per to 17 per cent to the total costs.

Despite these huge fees, almost one in three Brits decide to buy their cover as they go.

The study also revealed that monthly payers are also less likely to switch providers, which can again save them hundreds of pounds.

The average cost of insurance has jumped by £41 over the past 12 months to sit at £815, according to Confused.com, making it the steepest increase since 2017.

Lee Griffin, chief executive of Go Compare, said: "The added danger here is that people paying monthly are statistically more likely to renew again with the same insurer, without checking the total cost.

"It can become a cycle of paying more, for people who can least afford to do that.

"People paying monthly may see having to cancel a direct debit and set up a new payment as an additional hassle.

"Equally, if you pay a smaller amount monthly, you are likely to be less price-sensitive than if you were to pay the full amount in one go.

"At the very least, you need to check what your insurer is charging for monthly payments and if you are with an insurer that charges 17 per cent extra for monthly payments, it is going to be well worth shopping around for a better deal."