Paying for your car insurance
When it comes to paying for your car insurance, there are two ways you can look to do it. Firstly, there is the option to pay in full. This means that you will pay the price of the annual premium at once and consequently you will be covered for a year’s worth of insurance. The other way is perhaps the more common method of payment. This is via monthly instalments. Monthly payments are smaller chunks paid throughout the year, though they do not provide just a month’s worth of cover at a time. The policy will remain a 12-month contract. So the questions is; which is better? Monthly vs annual car insurance.
Paying a lump sum at the beginning of your policy can be a big up-front cost and unmanageable for some people. The average insurance premium is in the region of £630, so you can see why so many people opt for monthly instalment payments. There is an option whereby you can negotiate a six-month contract. This is a compromise on annual payments with a more manageable 50-50 split. However, this is not always possible with each insurer, so it is important that you check before buying.
Monthly payments will require you to set up a monthly payment to your insurer, paying a portion of your premium. This will usually include an initial deposit, followed by 10 or 11 monthly payments. This allows you to spread the cost of your insurance over several months. This is opposed to the initial stress of paying in full.
It is worth bearing in mind that some insurers will not require you to make an initial payment which is usually roughly equal to 20% of the annual premium. This may take the stress of having to save a sizeable sum of money for the first instalment. This will vary between insurers so you may want to consider your individual policy wording before pursuing this route.
If you have any more questions, visit our website or speak to one of our experts on 0333 222 4005.