Motors: Beware of Insurance Small Print

INSURANCE costs are soaring due to a massive increase in personal injury claims and accidents involving uninsured drivers, with law- abiding motorists ultimately footing the bill.

Consumer watchdogs are warning drivers to beware of a new range of bolt-on extras for policies devised by insurance companies to make premiums appear lower.

Once the policies have been taken out, it is too late to renege on year-long contracts.

Motorists can face charges for simple everyday events such as moving house, which can land them with an administration charge of pounds 25 by the insurance company.

According to motoring advice website KwikGuides.com some insurers will charge up to pounds 25 to make a change to the details on which a policy is based, on top of any additional premium that may be due for a new car or address.

"The AA charges this rate while Churchill charges pounds 21 but Norwich Union makes no administration charge for policy changes.

"With 7.5 million cars a year changing hands and one in ten people moving home every year charges for policy changes net insurers a substantial extra income," says spokesman Stuart Coster.

The number of free days of full cover for taking a car to the continent also varies widely between insurers.

Churchill and Elephant include 90 days cover but Admiral and easyMoney charge for cover above third party. Direct Line and eSure offer three days cover but taking a car on a two-week break to Europe would cost up to pounds 50 extra.

The AA charges 24.9 per cent APR for paying monthly and Kwik Fit charges 16 per cent for paying in instalments, says KwikGuides.

The site's guide to choosing car insurance includes a chart that compares premiums and the small print of policies that could lead to extra costs later.

A free courtesy car is rarer as a standard feature, with insurers instead offering to guarantee a courtesy car only in return for an additional fee when buying the policy.

If drivers exercise their right to choose a repairer that is not approved by the insurer but which will provide a free courtesy car, insurers often charge a higher excess.

Costs such as the compulsory excess that motorists have to pay towards a claim can vary by as much as pounds 140 among different insurers, despite identical personal circumstances.

Mr Coster added: "Most of us will have a good idea whether we are likely to move house, change cars or take a car to Europe on holiday in the year ahead. Considering likely extra charges when buying will ensure the true annual cost of policies can becompared.

"Aiming for the lowest quote is often not enough to guarantee getting the best deal."

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