Swiftcover news update: There is evidence to suggest that
buying car insurance using a credit card can be more financially beneficial for
the customer.
“If it isn’t fuel tax or road tax, paying through the nose
for car insurance is another reason why driving is getting more and more
expensive. But while the insurance companies have us over that compulsory
insurance barrel, it seems they are also taking advantage of us in other ways
too with massive charges for monthly instalments and for cancelling a policy.
Payment by instalments is a welcome option for many people,
who would otherwise be faced with the alternative of finding a big wodge of
cash all in one lump. This is even more true for those whose car insurance
falls due for renewal between now and January when many are saving (or paying)
for Christmas.However, the rates that some insurance companies charge mean that
you would be better off paying for your car insurance with a credit card, where
the average APR is around 18% ; even better if you can find a 0% on purchases
card.
Our friends over at Which! researched the APRs charged on
monthly instalments and found that, although a couple of insurers, namely AgeUK
and the NFU charged nothing or a nominal (0% and 2.75% respectively) fee for
paying monthly, most insurers were indeed making hay while the sun shined. And
the rates varied wildly. The next lowest fees were levied by Hastings at 14.9%
and Co-operative Insurance at 18.5%, followed by Mercedes-Benz Insurance,
Admiral and Elephant all on 18.6%.
At the other end of the scale, the insurers making sure they
got their money’s worth were Kwik-Fit Insurance on an eye-watering 52.32%
(looks like it’s not just car
repairs they
rip you off with), Endsleigh on 39.7%, Allianz on 34.8%, Zurich on 33% and AXA
and Swiftcover both on 32.4%.
However, Which! also looked at other fees levied on the
policy, including cancellation fees. Cancellation fees are levied if the
insurance is cancelled part-way through an insurance year and seems to be just
another way of extracting additional money from people- especially galling for
those who might give up a car to save/recoup money. Again, the level of
cancellation fee varies wildly, from £0 (AgeUK, NFU, Allianz and Volvo) up to
£70 (Natwest and RBS).
Overall, Which! have compiled an index of the best and worst
insurers for instalment interest and all cancellation and other policy charges,
which can be seen in its full glory here. Top of the shop are AgeUK,
NFU and Volvo with scores of 100 or 92 out of 100. Dragging up the rear are AA
(51/100), Fifty Plus (49/100) and Hastings (a pitiful 36/100).
So next time you are weighing up your lowest premium and
maximum cashback calculations, make sure you factor in these costs as well. Or
get yourself that cheaper credit card.”
This article was originally published at www.bitterwallet.com.
More information on Swiftcover and their insurance services,
click here.
No comments:
Post a Comment