UK car insurance is something you want to avoid skimping on. According to the Highway Loss Data Institute, £8.5 billion of auto claims were paid out in 2017 alone, with bodily injury and property damage making up almost half of that total. You’d want to protect yourself from financial disaster by getting the best car insurance policy possible. And one way you can do that is by paying monthly for your car insurance premium instead of paying all at once annually or semi-annually (or however often). But why pay monthly instead of annually? And will it save you money? Here’s everything you need to know about this increasingly popular payment method:
What is pay monthly car insurance?
Pay monthly car insurance (also known as ‘pay as you drive’) is an option that allows you to pay for your car insurance in monthly installments. You can pay for the whole duration of your policy or just for the first year, depending on your needs. If you’re buying a new car, this might be a good choice because it will help spread costs over time and make them more manageable.
You can cancel your policy anytime and get a refund if necessary. No cancellation fees are charged by paying monthly providers like Direct Line Car Insurance or Gocompare Car Insurance.
How does paying monthly car insurance work?
Monthly car insurance is a great way to pay for your car insurance. You can pay monthly with a credit card, debit card, or direct debit over ten monthly payments.
The benefits of this method include: You don’t have to worry about paying the whole sum upfront; instead, you can spread the cost over several months or even years. You’ll get an interest-free period on any balance you have left on your policy after paying off each installment (so long as you keep up with all payments)
Is it cheaper to pay monthly for car insurance?
Yes. You can save money by paying monthly for your car insurance. If you pay annually, your premium will be higher than monthly over ten payments.
The benefits of this include:
- A cheaper overall cost of your policy
- More flexible payment options
- The ability to cancel or change plans at any time during the year
What are the benefits of paying monthly for car insurance?
The benefits of paying for UK car insurance monthly are numerous. The first and most obvious reason is that it’s easier to budget for the cost of the policy since you know exactly how much money will be coming out of your account each month. Paying by direct debit also makes it less of a strain on your finances, especially if you have a steady income and can afford higher payments than paying annually or quarterly in one lump sum.
Additionally, some companies offer incentives when customers pay by direct debits, such as lower premiums or cashback offers, making them even more appealing if available through your provider!
Does paying monthly reduce my premium?
You may get a lower car insurance premium if you pay monthly rather than annually. This is because the insurer can spread the cost over ten months instead of 12, which means they have an extra month of income from their customers.
But paying monthly is only sometimes better: sometimes the opposite applies, especially if you’re young or have yet to make any claims in recent years. That’s because insurers tend to offer more attractive deals on annual policies, so some people find that paying for 12 months at once is cheaper than spreading payments over ten months (and then having another 11 free).
Also, remember that although some companies offer discounts if you take out a policy online or by phone rather than through an agent in person (which may save around £100), others don’t offer anything at all – so shop around!
Buying a car is easier if you’re not worried about financing it
You don’t have to worry about financing or saving up because you’re paying for the insurance by direct debit over ten monthly payments. You won’t see the money from your salary go towards making payments on your vehicle, Suitable for all categories of vehicle or driver and no requirement for collateral
Paying monthly car insurance is a great way to save money on your UK car insurance. It can also be used to finance your next vehicle by paying off the cost of cover over time instead of having one big bill every year. If you’re looking for more information on how to pay monthly works or whether it could help with your current situation, don’t hesitate to contact us today!