Loyal older drivers face insurance price hike
Older drivers lose out by being less likely to shop around.
Drivers who are in their 50s and 60s are more likely to lose money on their car insurance, as they are less likely to shop around and find the best deal on the market.
People in this age bracket in fact face price hikes of 8% compared to the average 2% that younger age groups have experienced in the last three months.
Motorists aged 68 are thought to be the worst hit, with an average rise in their premium of £41 during the three months to December 2018. This is according to a study done by Confused.com.
More than half the drivers surveyed had renewed their car insurance with the same company, rather than switching to a provider that offered a better price.
Prices of car insurance are beginning to increase again after a period of decline, with average costs rising to an average of £774 per year in the last three months.
The Alliance of British Drivers said that motorists were ‘regarded as having a bottomless pot of money.’
A spokesperson for the Association of British Insurers said that it was a ‘good idea to shop around’ in a ‘very competitive market’.
The group’s website advises that drivers should ‘shop around for the best deal, but never buy a policy based on price alone — the cheapest policy may not cover all of your needs.’
A consumer watchdog also warned recently of ‘loyalty penalties’ that are costing drivers almost £700 in the TV and broadband market, indicating that many loyal customers across different industry areas are being ripped off.
The Competition and Markets Authority announced new plans to stop this happening, as it is unfair that loyal consumers are being penalised.
They found that there was a total loyalty penalty in the UK of around £4 billion each year, across mortgages, household insurance, cash savings and broadband contracts.
Among the ideas for stopping this was the proposal to bring in price caps for these industries.
Now, it seems that many older drivers are having to pay loyalty penalties for car insurance, as they are less likely to use price comparison tools and read up on what other deals they might be able to get, instead sticking with the same insurance firm.
With this in mind, it is advisable that all motorists — but particularly older drivers — find the best deals for their car insurance and use price comparison sites like A Spokesman Said. This way, many customers could save themselves big money and avoid getting hit by price hikes because they stick with the same insurer.
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But these battles cost us money. You could help us fund these fights by using our price comparison site, A Spokesman Said for your energy, car insurance and household bills.
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When did you last switch your car insurance provider?
Last year 65% of customers didn't switch their car insurance to try and get a better deal.