Paying For Car Insurance

[Onemcs]

Right,

I've been given a quote lump sum quote (Cheapest) of £1500.00 for my car insurance

Should I wish to Pay Monthly I lose the "Lump Sum Discount" plus 18.8%apr! = £2,000.00

I don’t have all the funds yet to pay off in full. Will easily be able to by April Pay cheque.

What are my options?

1. Pay two months (170 x 2) , then cancel and renew for the lump sum
2. My brother mentioned the word "Credit Card" but have never had such item
3. ?

What would you do?

[eightseventhree]

0% credit card then pay off before the term runs out

nice lurking by the way

[Onemcs]

Had a brief look.

Is that 0% on purchases? Sorry never delved into the world of credit cards.

Many Thanks,

[rog007]

If you're sure you'll keep the vehicle for the full term of the insurance then attempt to pay in one go to keep costs down. If you cancel before the end of the term you will not get all the unspent term costs back. If you think you may cancel before the end of the term, then monthly may be a better option, but not by much.

Re credit card; apply for a 0% interest rate card (may take up to 14 days to sort), usually for 10-12 months. Buy insurance using that. Note however there may be up to 3% surcharge for using a credit card and you have to make sure you do pay off whole amount before the interest free period ends otherwise you will be charged a punitive interest rate. So make sure you lock the cash away to be able to pay it off. Note that OFT is investigating surcharges retailers make us pay when using credit cards but not in time to help you!

[Gareth79]

rog007 said:

If you think you may cancel before the end of the term, then monthly may be a better option, but not by much.

Monthly payment is still an annual policy - if you cancel you will still owe the remainder of the annual premium.

The amount that a policy will refund depends on their terms - some refund pro-rata less an admin fee, some (especially specialist policies) will refund at a diminishing rate, such that at 9+ months in you will get nothing back.

[Onemcs]

I've been told that to cancel my admiral policy it would be £50.00 in admin fee's. They dont/shouldnt demand the rest of the policy?

Will ring them tonight and find out!

[Onemcs]

Had A chat with Admiral.

The fee to cancel my policy is £47.50

So could take the new policy out by using a 0% interest credit card and pay off within the two months of the transaction. (I have no intention whatsoever to keep it any longer.)

Would save roughly £600.00 doing it this way.

Just need to decide which credit car to apply for. there seem hundreds?

http://www.moneysupermarket.com/credit-cards/purch...

[DAVEST205]

The fee to cancel may be £47.50 but you wont get ten months monthly premium discounted

For example (aviation insurance)

1 month on risk ... ... ... ... ... ... ... ... ... ... ... ... ... 20% annual premium
2 months on risk... ... ... ... ... ... ... ... ... ... ... ... ... 30% annual premium
3 months on risk... ... ... ... ... ... ... ... ... ... ... ... ... 40% annual premium
4 months on risk... ... ... ... ... ... ... ... ... ... ... ... ... 50% annual premium
5 months on risk... ... ... ... ... ... ... ... ... ... ... ... ... 60% annual premium
6 months on risk... ... ... ... ... ... ... ... ... ... ... ... ... 70% annual premium
7 months on risk... ... ... ... ... ... ... ... ... ... ... ... ... 75% annual premium
8 months on risk... ... ... ... ... ... ... ... ... ... ... ... ... 80% annual premium
9 months on risk... ... ... ... ... ... ... ... ... ... ... ... ... 85% annual premium
Over 9 months equivalent to Annual

Im presuming motor insurance works in a similiar fashion, so your 2 months of cover will cost you 30% of the annual premium.

HTH

[Onemcs]

Thanks for the above advice!

I rang admiral yesterday and they pro rata the rate accordingly.

E.g. Premium = £1500.00 / 365 days = £4.10 per day

£4.10 x No. Of Days Insurance Used. + 47.50 (Cancellation Fee.)

Didn’t think was too bad. Only time you'd have to pay the entire premium would be if there was a claim. Definitely worth checking though!


With Regard to the Credit Card I went on MoneySuperMarket.com and put my details in. They give you a score out of 10 how likely you are to be accepted. I've applied for a 0% interest on purchases and balance transfers for 10 months. Seemed the best and received a good score on Moneysm..

Just have to wait for the acceptance now!