Motor Insurance Industry News

← Back

Young drivers should avoid direct debits

Mon, 20 Mar 2006

Young Drivers could reduce their Motor Insurance costs by avoiding paying their premiums via direct debit.

New research from price comparison website MoneyExpert.com discovered that UK drivers are adding £2.7 billion to their annual motoring costs because they opt to spread the cost of policies using direct debits.

It is estimated that around 18.5 million Motor Insurance policies are paid for on a monthly basis yet many people do not realise they are paying extra for the privilege.

Tim Berry, a director at MoneyExpert.com, said: "People should bear in mind that some insurers believe they are making a loan to customers when they let them pay by this method."

He added: "That means the convenience of spreading your payments comes with a charge which can wipe out any savings they may have earned through researching the market for the best deal."

Instead, Young Drivers are being encouraged to consider paying 100 per cent of their annual insurance costs upfront or factor in the cost of any direct debit-related charges before renewing their policy.


© 1998-2005 DeHavilland Information Services plc. All rights reserved.

Endsleigh Insurance Services Limited is authorised and regulated by the Financial Services Authority. This can be checked on the FSA Register by visiting its web site at www.fsa.gov.uk/register.
Endsleigh Insurance Services Limited. Company No: 856706 registered in England at Shurdington Road, Cheltenham Spa, Gloucestershire GL51 4UE.