Drivers could save up to £65 per year on insurance by paying upfront

Motorists who pay for their insurance upfront rather than in monthly instalments could save up to £65 per year, new research has found.

Paying upfront for a whole year’s insurance costs an average of £623, compared with the combined sum of 12 monthly payments which reaches £688, as of December 2022.

Research by comparison site Comparethemarket also found that the cost difference between a monthly and annual payment has increased by £12 year-on-year.

Car insurance premiums have risen ‘across the board’ over the last 12 months, with the average cost of paying annually hiking by £71 year-on-year and the average premium for paying monthly rising by £83. Comparethemarket says that the cost of car insurance claims has risen due to the increased price of second-hand cars and higher vehicle repair costs.

Julie Daniels, motor insurance expert at Comparethemarket.com, said: “As living costs continue to rise, many motorists are feeling financially squeezed. Saving on your car insurance is always attractive, considering that the average cost of car insurance is more than £600.

“Although making smaller monthly payments might seem easier, if you’re in a financial position to be able to pay your car insurance policy annually, it could lead to savings of up to £65.”

Drivers can save up to £374 on their car insurance by switching, says Comparethemarket, while a recent survey conducted by the comparison site found that one in three motorists have struggled to afford the cost of driving recently and four-in-ten believe that they would no longer be able to keep on the road if costs continue to rise.