Drivers beat sky-high car insurance by haggling down the price as premiums soar 14% to national average of £788
- Car insurance prices are soaring and have risen 13.5 per cent since 2015
- 20 per cent of drivers have cut the cost of insurance by haggling
- The best ways to haggle the price down on your car insurance
Drivers are now paying an average of £788 for car insurance, a rise of 13.5 per cent in a year, but one in five has managed to cut their premiums by haggling.
One of the main reasons prices have risen at such a fast rate in the past year is due to the two hikes to insurance premium tax.
But one way to cut the price you pay is by haggling with your insurer and getting it to lower the price.
Rising costs: Haggling is one way to cut the soaring price of car insurance premiums
Of the 5,000 drivers asked by the research company, between June and August this year, 20 per cent said they were offered a lower price by their current insurer at renewal when they asked.
But the discount offered varied between those who haggled and while 25 per cent agreed to stay with their insurer for the lower price, 15 per cent said the savings were not worth moving for.
Haggling can be especially useful for younger drivers as they are paying the highest bills with average premiums for under-25s at £1,831.
One reason costs have increased so quickly is the change to IPT in the past year. The tax is applied to insurers but the cost is passed onto consumers through the rising cost of premiums.
Car insurance costs are up 13.5% but you may be able to cut your premiums by haggling
Last November it rose by 3.5 per cent to 9.5 per cent, and on October 1st it went up again by 0.5 per cent to 10 per cent. It applies to all areas of general insurance including car, home and pet insurance.
However, if you're looking to cut the cost of your car insurance, haggling isn't the only route to take.
As the best prices are usually reserved for new customers, shopping around when you're at renewal to find the cheapest price available should be your first port of call.
Once you've found the cheapest price, by checking comparison sites and the insurers not listed on them such as Direct Line, you can then go back to your existing insurer and ask it to match the price. If it's not willing to match or lower the price you are free to move to an insurer that will.
Ian Hughes, chief executive of Consumer Intelligence said: 'Haggling with insurers clearly pays as drivers who make the effort to negotiate are finding.
'Insurers are generally receptive to renewal premiums being queried and will offer reductions to try and keep customers. It's always cheaper to keep a customer than find a new one.
'When premiums are rising and other people are haggling successfully there really is no excuse for not haggling or shopping around.'
HOW TO HAGGLE DOWN YOUR CAR INSURANCE
Haggling is generally not a very 'British' thing to do but it can work and could make a substantial dent to your insurance costs.
The best way to go about haggling is to be organised and confident. The best time to start looking is when you're coming up to renewal. Check the major comparison sites to see if you can find a cheaper deal and look at insurers not listed on them.
Once you've found the best price, go back to your existing insurer and ask it to lower the quote it's given you for the next year. Tell it you would like to cancel your policy if it's not willing to match or lower the quote.
Most likely it will drop the price but if it doesn't you're free to leave. You can also ask it to throw in extras if it's not willing to lower the price, such as free breakdown cover.
You can haggle even if you're not at renewal but there may be admin charges to leave for cancelling your contract early.
If this is the case, work out how much you'll need to pay in charges, if it's minimal compared to the saving you'll make switching then it may be worth doing.