Martin Lewis used the latest episode of his Martin Lewis Money Show Live broadcast on ITV to explain how the best time to compare prices for cheaper car insurance
Martin Lewis is founder of MoneySavingExpert.com(Image: ITV)
Martin Lewis has explained the exact time to shop around for cheaper car and home insurance.
Car insurance is a legal requirement in the UK – and it turns out, there is a “sweet spot” for when you should be checking for the cheapest quotes.
The MoneySavingExpert.com founder used the latest episode of his Martin Lewis Money Show Live broadcast on ITV to explain how the best time to compare prices for cheaper car insurance is 26 days before your current policy ends.
For home insurance, the ideal day to shop around for the cheapest quotes is 15 to 20 days before your existing policy ends.
Martin Lewis said: “When you get your quote, so the number of days before you get a new policy, which will normally be your renewal date, can massively affect the price of the quotes you’re getting. This is based on millions of quotes.
“So, the sweet spot is roughly 26 days before the new policy, but a couple of days either side of that, doesn’t really matter. By the way, [for] home [insurance], it’s more here, it’s a little bit earlier – 15 to 20 days beforehand.
“The price you’re quoted there – and it doesn’t work for everyone, but it does for many people – will be nearly half what would happen if you got a quote the day of your renewal.
“Anyone want to hazard a guess why?… What actually happens is, all of insurance pricing is based on… who is a bad risk?
“The type of people who leave it to the last minute are deemed to be a higher risk than people who go and get their insurance earlier.”
The MoneySavingExpert.com heard from one viewer called Selene, who was able to save £445 by timing her renewal quote.
She said: “Last year I paid £913 for my car insurance. I thought it was because I was old… I’m 63. This year I used your 26-day rule and, for the same policy, I paid £468, saving me £445 which is a 49% saving. Thank you so much!”
Save money on insurance
The three main types of car insurance are: third party, third party fire and theft, and fully comprehensive.
The different types of home insurance are: buildings insurance and contents insurance. You can also get a single policy that covers both your building and contents.
When the time comes to look for other quotes, you should use a comparison website to check for prices. It is also worth checking quotes with some providers directly, as not all appear on comparison websites.
One of the big brands that doesn’t appear is Direct Line. Once you’ve found the best deal elsewhere, call up your current provider to see if they will beat it.
If you do go with a new policy, you should see if you can get cashback on sites such as Topcashback and Quidco.