‘I saved £300 on my car insurance with simple Martin Lewis trick’ | Personal Finance | Finance

I, like every other motorist who owns or finances their car, go through the annual task of reinsuring my car.

How much your insurance costs often depends on a variety of factors. These include your job, age, profession, relationship status, and how long you’ve been driving for among many other factors.

This is why I was a little intrigued when I saw a tip being suggested by the well respected personal finance expert Martin Lewis who suggested there was one way people could save on their car insurance. Intrigued by what he had to say I tried it out myself.

The trick is both simple but nuanced – renew your insurance early. However, this doesn’t mean renewing 11 months before your current policy expires. No, there’s a specific point which is the “sweet spot” when it comes to signing up for your insurance.

Speaking on the Martin Lewis Money Show Live on ITV, he suggested comparing car insurance prices specifically 26 days before your renewal date.

He 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.”

At first, I was cursing myself as I realised I’d missed this specific day in my calendar, but Martin added: “but a couple of days either side of that, doesn’t really matter.” Cue a sigh of relief and a return to the experiment.

After getting my renewal letter from my existing insurance company, I compared it to quotes on a price comparison website. I was surprised by how much I was able to save by switching early – around £300.

I should stress that before I went for the new policy, I asked my existing car insurance provider, who had been nothing but helpful during my time with them, if I was able to get a lower renewal quote; it was only when they said no that I cancelled the autorenewal.

I’m not the only one to have saved either. A woman called Selene told MoneySavingExpert.com she saved £445 using the same trick. But why does it work?

On why it might work, Martin said: “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.”

There are also questions about why someone’s car insurance may increase in price even if nothing has changed in their lives in the year they’ve been with the company.

On this, MoneySavingExpert’s Chris Collier said there are any number of reasons for this. He continued: “The rise you’ve seen could be down to rising costs that insurers have to pay to get vehicles repaired or replaced (such as rising staff costs, more expensive parts).

“Or it may be that your insurer has changed its strategy and no longer wants to offer the best prices, or no longer wants customers with your risk and driving profile.

“Of course, the above assumes that nothing’s changed with your circumstances. If it has, then where you live, the car you drive, and any driving convictions or accidents (losing any no-claims bonus) can all change the price you’re quoted.”