The 10 million drivers whose premiums will increase after lockdown

Cost of car insurance expected to rise as lockdown eases

Around 10.5 million drivers could see a spike in their car insurance as people return to work after lockdown ends, data from comparethemarket.com shows.

Some 61% of drivers expect to commute by car when they return to work, almost double the number of people who drove to work before the pandemic took hold.

Motorists intending to drive to work who did not do so before the pandemic will need to update their insurance to a 'social, domestic, pleasure and commuting' policy (SDP+C). The norm is the standard 'social, domestic and pleasure' (SDP) deal.

SDP+C policies tend to be more expensive.

For example, a 36-year-old man living in West London, who has driven for 19 years and has a Skoda Octavia will pay around £330 for an SDP policy. This rises to around £350 for an SDP+C policy, a 6% increase.

The proportion of people who will start driving to work in light of the pandemic varies across the country, but is particularly high in Northern Ireland, Wales and the West Midlands.

But even non-commuting drivers are also likely to see a spike in their premiums.

This is because a rise in the number of people driving increases the overall risk of accidents.

Insurance providers factor this risk into what they charge for policies, so as people return to the road all new car cover will become more expensive.

Dan Hutson, head of motor insurance at comparethemarket.com, says: “Motor premiums, which have fallen recently, could be about to jump once more. More drivers will need to adapt their policies to include cover for commuting and insurers may increase their prices in anticipation of more cars, and more crashes, on the road.”

How to get cheaper car insurance

These three simple tips that could help make your car insurance cheaper. 

1) Do not auto renew

Insurance providers often reserve the best deals for new customers, so it does not pay to be loyal. Shopping around for car cover can help you find the best offers.

Price comparison websites allow you to compare hundreds of deals quickly and easily. It is also worth researching the level of customer service each provider offers, to ensure that any claims and queries would be handled efficiently. 

2) Read the terms and conditions carefully

Once you have got a few insurers in mind, read the terms and conditions of each policy carefully to make sure you will get the right cover for the things you need.

If anything is unclear, get in touch with the provider for clarification. Once you sign up to a policy, you will not be able to claim for things that are expressly excluded.

3) Pay annually

Paying for car insurance in one lump sum is usually cheaper than by monthly instalments.

This is because paying monthly is essentially like paying off a loan, and providers add interest to each payment.

If you cannot afford to pay it all in one go, it is worth trying to get a 0% interest credit card to make the payment.

That way you can benefit from a cheaper premium and repay in monthly instalments without incurring interest.