New research reveals that more than half of Aussie motorists have incurred inflation-driven car insurance premium hikes in the past 12 months.
A survey from consumer research group Finder of 933 drivers found 53 per cent had had recent increases to their car insurance premiums.
But even though inflation continues to drive the cost of living through the roof, these increases don’t seem to have many worried. Just 9 per cent of respondents listed car insurance in their top three most worrying bills.
Concerningly, the research also found 11 per cent did not know whether their insurance had gone up, meaning the number of price hikes could be even higher.
James Martin, insurance expert at Finder, says car insurance premiums are driven by a range of factors.
“Car insurance premiums go up for many reasons, from higher parts and repair costs, to increasing crime rates and even natural disasters,” he says.
“It’s also costing more for insurers to process claims. This means you could see your premium rise despite no change in driving habits or claims being made.”
According to the survey, price (46 per cent) is the most important factor Australians look for when choosing car insurance. Other determining factors included comprehensiveness (32 per cent), and brand recognition (14 per cent).
Finder also recently announced its best car insurance providers for 2023, rating more than 1100 policies from 37 brands in two categories – Features and Value.
Youi’s comprehensive policy took out the Features category, with Finder noting the policy covers more than comparatively priced policies. Surprisingly, the other policies noted in this category were Qantas comprehensive and Hume Bank comprehensive policies.
In the Value category, Finder says you can’t go past Budget Direct’s comprehensive offering, while the honourable mentions went to Hume Bank and Youi.
Mr Martin says there are a number of steps you can take to reduce your premiums.
“Opting for a higher excess will reduce your premium – sometimes by a few hundred dollars – but you’ll need to pay more up-front if you need to make a claim,” he says.
“You could remove cover for under-25 drivers, if you’re sure no younger drivers will have to use your car.
Another way to reduce costs is to avoid the temptation to claim for minor damage – even if paying yourself will cost more than your excess. This is because your insurer will increase your premium each time you make a claim.
Also keep an eye out for any bonuses being offered by insurers to switch, you don’t want to get stuck paying the ‘loyalty tax’.
“Look for discounts like sign up offers, and always review your policy at least every 12 months,” Mr Martin says.
“Remember, loyalty doesn’t pay – the best value policy today might be more expensive when it renews next year. You could save hundreds by switching providers.”
Has your car insurance gone up recently? When was the last time you checked? Let us know in the comments section below.
Also read: Most expensive health insurance policies revealed
