Even if you get everything else right, applying for car insurance on the wrong day could see you pay as much as 40% more than you need to.
Those are the findings of a new report from Moneysavingexpert , looking into the best and worst time to renew.
Buying too early, or too late, sees the price of renewing your car insurance shoot up, with a typical policy costing £1,218 on renewal day compared to just £672 if you apply 24 days before.
"We’ve analysed 50million quotes to find the new sweet week for car insurance is 20 to 26 days before your renewal is due – this can cut your costs by nearly 40%," Martin Lewis said.
“It works like this because the biggest factor in insurance pricing is 'actuarial risk', which means price is dictated by the likelihood of claims, based on data of millions of drivers' claims history.
"Some of these, including car type, address and occupation, are well known. Yet the regulator, the FCA, recently reported there are 50 to 400 different factors, many of which are hidden."
And when you renew is one of those 'hidden' factors.
“Insurers have admitted to us that quite simply drivers who leave it until the last minute are statistically riskier, therefore they pay more," Martin said.
Which means, even if you get everything else right, renewing on the wrong day means you'll pay more.
So to save cash, get your diary out, check when your policy ends, then circle the date 26 days before than to remind yourself to renew.
