New Car Insurance Rules

Love it or hate it, car insurance is a necessity for any UK motorist in order to drive on the roads legally. As a driver are you up to speed with car insurance changes in 2022? If not, we here at Wilsons Epsom are able to help!

In our blog article dedicated to the new 2022 car insurance rules, we explain more about what has changed, why prices have gone up, and what measures you can take to help save on costs… 

Car insurance renewals

Is your annual car insurance up for renewal? If so, you could be in luck! Thanks to a new rule introduced by the Financial Conduct Authority (FCA), the ‘loyalty penalty’ is now banned. For customers fed up with not being rewarded for their loyalty, this is great news. 

As of 2022, wave goodbye to higher fees for existing customers. Instead, car insurance companies are required to offer the same fee that they would to entice and favour new customers. To think that loyal customers were previously penalised for their decision to stay with a car insurance company, blows our mind.

However, don’t fall into a false sense of security, as we explain below…   

Prepare for premium increases

With news that the ‘loyalty penalty’ is no more, you may assume that this means car insurance prices will go down. This simply isn’t true. In fact, car insurance quotes have increased by between £25-£45 since the beginning of the year. 

It’s worth bearing this in mind when shopping around for car insurance quotes, but now that your current provider has to offer you a fair price, you may well find yourself staying put instead. 

Why have car insurance prices gone up?

UK drivers are now paying up to 6% more for their car insurance compared to this time last year. According to Confused.com, British motorists are paying an average of £554 per year for fully comprehensive car insurance. So, why have prices increased?

Well, it’s a reason you are hearing time and time again, and it’s all down to the dreaded pandemic. During COVID-19’s repeated lockdown periods, car insurance prices actually fell. This was mainly due to the fact that people refrained from driving due to nationwide restrictions, which resulted in fewer road accidents overall.

Now that things are steadily getting back to normal, our driving habits have returned to near pre-pandemic figures, meaning that sadly, so too has the number of road accidents. This increase in car insurance claims has resulted in prices going up. 

How to get the best insurance deal

Interested in finding out how you can get the best deals on car insurance? Read our top tips for securing cost-effective car insurance for the year ahead… 

Compare car insurance quotes

When it comes to comparing car insurance quotes, shop around! Despite the ‘loyalty penalty’ being banned, we’d still encourage all drivers to continue with the habit of comparing quotes. Before your car insurance renewal is due, actively take to comparison websites to check prices against the competitors. 

Now’s the time to negotiate

A lower price offered by a key car insurance competitor may be just the ammunition you need to negotiate an even lower premium with your existing car insurance company. Many car insurance firms will be able to match the price quoted by another - as the saying goes; if you don’t ask, you don’t get! 

Pay your premium annually

If you can afford to pay your car insurance in one lump sum, then this option will work out cheaper. Opting to pay by a monthly Direct Debit will slightly increase the cost of your quote, so choosing to pay your car insurance annually, works out better.   

Beware of auto-renewal risks

Auto-renewal is a convenient, yet cheeky tactic used by car insurance companies to lure you in for another year. On the surface, auto-renewal seems like a handy solution, freeing you from the somewhat time-consuming task of shopping around. However, auto-renewal can also come at a price - even if it’s just a few pounds. Instead, take the time to search for a car insurance deal to suit you. 

Futureproof your policy

Opting for a new car insurance provider each year may save you money in the short-term, but is it the best option long-term? If your vehicle needs are set to remain the same, you may be better off sticking with the same car insurance provider, especially if they already offer a great value policy. 

Some car insurance companies even offer perks to keep your custom, such as roadside assistance and legal advice. With this in mind, always dig a little bit deeper with your current provider before making a final decision.

Add up the add-ons

Many car insurance comparison websites will not only show the basic cost of the policy, but will also demonstrate prices for additional items, such as breakdown cover, motor legal protection cover, and more. Consider if these add-ons are necessary, and if so, could they prove cheaper when purchased separately?

Be accurate about your annual mileage

When applying for car insurance, the provider will need to know the amount of miles your vehicle travels during the year. While this may vary depending on your circumstances - such as a last-minute holiday or unexpected work meetings - you’ll need to work out your average mileage. Be realistic. It’s always best to overestimate the amount of miles you do per year, as underestimating may lead to problems if you need to make a claim.   

Step up your car’s security

Vehicle theft and thefts of items from cars are ever-present. To help give your car insurance provider the confidence that you keep your vehicle as safe as possible, think about how secure the vehicle is. Not only the car itself, but where it is parked overnight too. A customer with a car that has a top-notch security system and is parked in a secure place overnight, is more likely to be quoted cheaper insurance, knowing that the company is less likely to pay out. 

We hope our car insurance rules article has helped to give you a better insight into what you can expect from your car insurance provider in 2022. If you’re looking for a new or used car, then don’t leave without visiting our online showroom to explore what we have on offer.