11:00 a.m. June 10, 2022
Everywhere you look, prices are rising and there’s one group of people who take an almost constant financial hammering: the motorist.
In addition to a spike in used car prices, which are up 30% year-on-year, and more expensive vehicle repairs (an 11% rise since June 2021), last week the RAC reported that average fuel costs had risen to 170p per liter for unleaded and 181p for diesel. Those brave (or wealthy) enough to venture down a motorway will find prices at the pump are even higher, pushing 186p and 197p respectively for a liter of unleaded or diesel.
The cost of fuel is one of the most discussed topics in British society, ranking almost alongside discussions about our variable weather. And for good reason: at present, the level of fuel tax (around 46% of the total) means that the British motorist has to bear the seventh highest fuel cost in the world.
Yet while fuel prices are a constant pet peeve, the motorist’s most important annual fixed cost — car insurance — offers little financial respite, especially if you’re 50 or older.
Since January, drivers aged 50 and over have seen a 6.2% increase in insurance costs, the biggest increase of any age group. In addition, elderly motorists in East Anglia now pay an average of £656.14 for annual insurance cover, 22% more than drivers in the South West.
This is partly due to new rules introduced in January which prohibited insurers from offering new customers discount car insurance deals that are cheaper than those available to their existing customers.
However, there is still a huge gap in car insurance costs. To take advantage of these often huge differences, motorists are advised to shop around.
Ken Carter, head of insurance services at personal finance website Moneymapp.com, says: ‘Despite the new rules, motorists can still save up to £290 on their car insurance when using the insurance comparison on our website.
“The January legislation means that individual insurers can no longer sweeten introductory offers to attract new customers if the same offers are not available to existing customers. Nevertheless, significant differences remain between what insurers charge for coverage.
“The technology built into the website allows us to compare the insurance costs charged by over 100 insurers and present them to motorists who typically have the opportunity for huge savings.”
The savings are real good news for the demographic groups most likely to benefit from lower automobile costs, namely those aged 50 and over. To date, the insurance comparison service has attracted more than three million users and earned the coveted ‘Excellent’ rating on Trustpilot.
The tool is also remarkably easy to use. Simply type in your registration number on the Moneymapp.com website, add some personal details, including driving history and vehicle usage information, choose the level of coverage you need, and the technology behind the scenes gets to work. Within minutes, you’re presented with a clear, no-nonsense summary of car insurance costs. Naturally, the decision to continue or to request additional information remains in the hands of the motorist.
The simplicity and speed of this service could help millions of drivers who are currently paying too much for their insurance, including an estimated 16 million motorists who allow their car insurance policy to “automatically renew” each year – a costly oversight. which costs around £830million a year, or almost £52 each.
Anecdotal evidence suggests that as inflation takes hold, motorists take fewer trips, buy a little less fuel, drive more carefully and (a personal favourite) “ride” where road conditions permit in order to ‘to save money. Considering how resourceful and inventive motorists are, shopping around to save on annual insurance expenses makes perfect sense.
Mr Carter adds: ‘As the cost of daily living continues to soar, this is a relatively simple saving to be made on what is often the motorist’s most significant fixed cost.’
There is little reason why the average annual car insurance expenditure levied on East Anglia residents aged over 50 is comparable to that charged, for example, in the North East or East Midlands. Drivers have the opportunity to rectify this anomaly by exploring sites like Moneymapp.com before purchasing their next car insurance.
For more financial advice, check out Peter Sharkey’s regular blog, The week in numbers.