Saving Money on My Car Insurance
Car Insurance. Eugh!
I’ll make this as quick as I can because I wasted an hour of my life that I’m never going to get back researching this and changing insurers and I don’t want you to waste more than 10 minutes reading this! But it’s worth it, I promise.
And I don’t want to come across as sounding too glib either because insurance, although dull and boring, is still INCREDIBLY important. And I should know, I’m sitting in a house that my insurer built for me - yep, insurance is very important, but I just resent paying more than I should be...
A few weeks ago I blogged about how much our cars ACTUALLY cost to run in a post called My cars cost $195 per week!
In it I noted the fact that we pay $1663 to AMI insurance for our two cars, a Mazda 2 and a Skoda Octavia. Several people got in touch (thank you) and to cut straight to the point they said “you are being screwed over Ruth, you should take a look around for a new insurer”.
So I did.
And I am being screwed.
So, I’m changing.
An incredibly helpful fellow Happy Saver had been on the hunt for car insurance recently and they sent me their list of online quotes for annual fees that they received. They of course had different cars but you’ll get the idea.
They cut to the chase and said “go with TradeMe for car insurance”. They are underwritten by Tower, but are actually cheaper than Tower? Another tip, do it online, it is cheaper! And they were not the only ones to tell me this.
So I jumped online and came up with the following:
AMI - I am currently paying $1663 per year for both vehicles.
I gave them the opportunity to do better and they quoted $1424. I did this online and then PHONED them to make sure this was the best they could do, I am after all a long standing client of theirs, yet sadly it was. I even told them I was about to change insurers and she said she would call me back. Still waiting… I never have any loyalty to banks or insurers and this just confirms I am right to think this way.
Using exactly the same specs of insured value, excess and glass buyout Trade Me quoted $849 per year for both vehicles.
That is a $814 annual difference!!!
Another change I am making is that I used to pay my premiums monthly, I find it just helps with budgeting that way, but I’m changing to paying them annually now because it will save me $108 annually. If I pay monthly my premium will be $80 but if I pay annually it works out at $71 per month, and that’s a saving worth making.
And another fun calculation for you:
If I invest that $68 that I’m now saving in monthly premiums in my index fund at a (generous) 10% return, assuming 1.5% for inflation, plus each month I keep adding $68; in 20 years, thanks to compound interest, I will have a balance of $57,945.
FYI, here is a great compound interest calculator to use: The Calculator Site
So, maybe that hour of my life spent looking for a new insurer was not wasted after all!
A big THANK YOU to all the lovely people who got in touch and shared their findings with me. And another thing, I’m not moving into the insurance market, there are no affiliate links here, I just like to share a good deal when I hear about it and success with my cars has certainly had me reviewing my other insurance as well, you can be sure of that.