Average premiums are expected to hit £900 over the course of 2018, leaving many drivers struggling to afford their vehicle.
New research has revealed that one seemingly cost saving ethos adopted by UK drivers, could actually end up costing them.
Over 16 million British motorists are making an error while choosing their premium relating to the optional excess.
Brits are taking on up to £750 of additional financial liability for an average saving of just £1 per month.
According to new data from uSwitch, 39 percent of motorists are opting for an excess of up to £1,000.
This is presumably because the average car insurance premium is cheaper with a higher excess.
However, the research reveals that opting for a £1,000 excess instead of a lower £250 amount will save drivers just £12 over the course of a year.
Therefore if a driver had to make a claim, they would be losing a large proportion of money than if they paid a little bit extra for the annual premiums itself.
Each year it is estimated that one in 10 UK drivers make a claim on their car insurance policy.
Interestingly, drivers who choose the highest voluntary excess option, usually £1,000, might think they will benefit from a significant saving on the annual policy cost.
However, in most cases, they are likely to pay the same premium as those who opt for a lower £500 excess but would be left shelling out £500 more if it came to making a claim.
Rod Jones, an insurance expert at uSwitch.com, says: “Worryingly a large number of drivers are taking on huge financial liabilities in exchange for tiny annual savings on their motor insurance.
“While many think that opting for a policy with a higher level of excess will save them money, drivers should ask themselves if an additional risk of £750 is really worth an average saving of just £1 a month and would they be put off making a claim knowing they’d have to pay a significant sum for doing so?
“With more than one in ten of those with a motor insurance policy likely to make a claim each year, we urge those looking to renew or switch their insurance to think seriously about the level of risk they want to take financially before they commit to a new annual policy.”
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