Buying your car insurance three weeks ahead of the start day is likely to get you the cheapest price from a comparison site, where it can slash the cost of your premium in half, an MSE investigation which scoured millions of quotes reveals.
But remarkably, being overly organised and getting your insurance too early could mean youre overpaying by £100s, while leaving it to the last minute will likely leave you paying the top price.
We’ve analysed more than 18 million quotes from Jan to May after requesting the data from three of the biggest price comparison websites Confused, Compare The Market and MoneySuperMarket. All three had near-identical trends in pricing, with an optimum time to buy your car insurance closely aligned to your risk profile and the time the highest number of insurers will provide quotes.
Buying from a comparison site is one of the ways to bag cheap insurance, see our Cheap Car Insurance guide for more tips to cut the cost.
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What does the data show?
Based on an average price for the millions of quotes returned on the price comparison sites, the cheapest time to buy your policy is 21 days before the start date, an average of £589 – £531 cheaper compared to buying it 30 days in advance, the earliest you can usually get a quote on comparison sites. Get it on the day its due to start and its an eye-watering £1,156 – £567 more expensive on average than at the optimum time.
Note: Of course, these figures are averages and as your premium is tailored to you and your personal circumstances, your savings will likely be different, however the general principle of when to buy your insurance still applies.
Martin: Avoid being a last-minute loser
MoneySavingExpert.com founder Martin Lewis said: “Car insurance pricing is based on a mix of actuarial risk and which section of the market is being targeted. To find the risk they look for patterns, and we’ve now uncovered one of those is how early you get a quote before renewal.
“To avoid being the last-minute loser, everyone with car insurance should, at the very least, put a note in their diary 25 days before renewal to ‘sort it within a week’.”
Why is there a price difference?
Quotations are based on a number of factors, such as the type of car, driving history of the driver, where you live and much more see our Cheap Car Insurance guide for full info.
We asked Compare The Market, Confused, MoneySupermarket, Direct Line, Aviva, LV, MoreThan and Admiral why the price differed depending how far in advance you got the policy. All told us generally the same thing.
Its all based around risk and buying it three weeks before you need it suggests youre more careful and organised, while leaving it to the last minute means you are seen as higher risk, with some insurers telling us theyve seen a direct link between drivers who leave sorting their insurance to the last moment and a higher number of claims.
As for why the super-prepared are being penalised for getting a quote 30 days in advance, its basically because there are fewer insurers returning quotes at that stage.
LV said: Our historic claims data shows that riskier drivers renew their policies nearer to renewal date.
Morethan said: Our data proves that drivers who obtain quotes on the same day their insurance expires, present a greater risk and this is reflected in their premium price.
Direct Line group: “Our claims data is based on years of experience and millions of policies and we see a correlation between last-minute purchasing and higher frequency and severity of claims.”
Will buying insurance 21 days in advance guarantee the best price?
Unfortunately, there are no guarantees as prices can change frequently, but it definitely helps to avoid being stung with a hefty premium. Here are three steps to help you bag the cheapest premium:
- Lock in a rate 60 days ahead. Some insurers Aviva* and Quotemehappy – let you lock in a rate 60 days before, without having any obligation to take up the offer. So just lock in a few quotes to benchmark a price. See our list of other insurers that let you lock-in 30 days in advance.
- Check your renewal price. Its usually sent 28 days before it is due, call them if you dont get it.
- 21 days before you need cover to start use the comparison sites. If you get a better quote than youve had so far, its likely to be the cheapest youll get.
More tips to getting the right price
- If you’re at renewal, it’s easy. NEVER automatically accept your renewal quote, just use our car insurance tips to bag the cheapest deal.
- If you’re midway through your policy, check if you can save for a £50ish admin fee (factor that in) you can usually cancel your existing policy and get the rest of the year refunded, provided you’ve not claimed.
- Combine comparison sites to speedily find your cheapest deal. There’s no one cheapest insurer, as prices are different for everyone – so check them all three weeks before you want your insurance to start.
- Then check the biggies comparisons miss. Direct Line* and Aviva* won’t appear on comparison sites, and can be competitive.
- Also check the hidden hot deals comparison sites miss. See our full list of current hot deals.