Up to 11 million UK drivers are looking to switch insurers this year as renewal prices rise, according to independent research company Consumer Intelligence.
The research found that the number of drivers shopping around at renewal time has reached a three-year high.
Up to 83% of drivers now claim to search for a better deal when their insurance renewal is due, the highest level since 2013, while 40% of drivers are expected to make the switch to a different insurer this year.
Drivers are looking to get a better deal on their car insurance as renewal prices rise. Consumer Intelligence found renewal price increases have doubled year-on-year. The average premium at renewal has increased by £22 in 2016, compared to an £11 increase last year.
Older drivers have been suffering from sharper price rises, with average premiums for over-50s up by 15.3% this year, compared to a 9.3% increase for drivers under the age of 25.
The steep price hike can be partly blamed on an increase in insurance premium tax, which rose from 6% to 9.5% of premiums in November 2015. A further increase is expected later this year, taking the rate of insurance premium tax to 10% of the premium cost.
270,000 more switches
While Consumer Intelligence found that the majority of drivers are shopping around for a better deal, around half still decide to stay with their current insurer at renewal time. However, the number of people taking advantage of other insurers’ prices is on the rise.
This year 50.5% of drivers stayed with their existing insurer as opposed to 51.5% this time last year. This 1% change may seem small, but translates into an extra 270,000 consumers a year switching insurers.
Ian Hughes, Chief Executive of Consumer Intelligence, said: “The message of rising car insurance premiums is really hitting home and drivers are making the sensible decision to look around for the best deal. We are seeing a real acceleration in shopping around and up to 11 million of the UK’s 27 million private car owners will move this year.”
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