A couple of points:

Insurance companies do rely on customer inertia and hope that they won't switch for a few pounds - I have a broker who looks at the market each year for me and who constantly either can offer a cheaper company or gets my current company to price match. Some companies do offer a (small) loyalty discount at renewal as they realise that it is far cheaper to renew a policy than put a new one on the books.

It is about a year since we started getting these £75 cash back offers on insurance policies - so many people will be having to pay that much extra.

The problem is: there is too much supply in the Direct Insurance Market so the Direct Companies have to pay a lot of money (advertising/ promotions etc) to secure business and they want to recover that cost at renewal. The companies my broker uses don't spend all their money advertising as they have brokers who can offer the policy in every town. The last motor survey showed that on average buying a policy through a broker was cheaper than buying it directly.

Finally - if your car is worth less than £1,000 do not pretend that it is - that is making a false statement for the purpose of obtaining a certificate of motor insurance and is a criminal offence! - some insurers don't want very old, low value vehicles in case a) there are mechanical problems that could cause an accident or b) the owners decide to dispose of them and claim under theft/ fire sections of the policy.

Hi all, thank you for your replies, I knew it was a stupid idea. My partner has a R reg  Rover 600 and although it is in very good condition he will be lucky to get £500 for it.

dpd:

hello pete,thanks for the reply!, so it dosen't pay to be loyal to your existing insurer then it seems?,as a matter of course,i normally shop around on re-newal anyway, but it would be nice not to have the hassle in the first place,and be rewarded for your good driving/claims record,by your existing company!, and i've used this site too,for quotes,

thanks again!

dpd.

Hi

2 querys on one thread - this confuses me (not hard tho)......

In response to your question dpd, in short the answer is no it doesn't pay to be loyal, which is why its vital to shop around each year, after all if they're showing you no loyalty then why should you show it to them?

Peter

loopy lolly:Hi Pete, my partners car insurance is up for renewal and he has asked me to get some quotes. His car is only worth around £500 but he wants me to put the value as £2000, is this a sensible idea or as I think a stupid idea. Thank you. Lorraine.

Hi

Just seen you've had a few replies to this and I would put the value myself at £1,000 just as some insurers wont insure the car if its under a certain value. I agree with Dave and teh other guys who've added here tho and don't think its worth while over estimating either, if the car does happen to be written off then its market value (usually according to the likes of parkers or alike) that is given to you for it regardless of the amount of value you have given the insurance company.

Kind Regards
Peter

I also dont see the point in overestimating - in the event of a claim they will only pay out the actual value, and not the over inflated estimate provided at inception.

However in my experience, very few companies will charge you any different unless the car is worth much more than they expect - and then they will start enquiring as to why (mods/raidos etc. being two obvious examples) 

loopy lolly:Hi Pete, my partners car insurance is up for renewal and he has asked me to get some quotes. His car is only worth around £500 but he wants me to put the value as £2000, is this a sensible idea or as I think a stupid idea. Thank you. Lorraine.

A friend of mine does this every year. Always keeps his 2004 car at £7,500 when it's actually about £4000. I keep telling him it's a bloody stupid idea; but the customer is always right!

One will be paying more premium and only receive book price, less any excess, in the event of a claim.

Is it a classic car he has? If so, then the value may be slightly higher depending on condition, and can get an agreed value.

The only reason I would put a value down as £1000 (even if it is less) is because some insurance schemes don't quote on anything below £1,000 and therefore may be slightly higher in premium trying to look for a scheme that does. Not too common though.

Do a search on here for the difference, and when you speak to the insurers over the telephone, ask them to amend the figure and see the difference!

Hi Pete, my partners car insurance is up for renewal and he has asked me to get some quotes. His car is only worth around £500 but he wants me to put the value as £2000, is this a sensible idea or as I think a stupid idea. Thank you. Lorraine.

hello pete,thanks for the reply!, so it dosen't pay to be loyal to your existing insurer then it seems?,as a matter of course,i normally shop around on re-newal anyway, but it would be nice not to have the hassle in the first place,and be rewarded for your good driving/claims record,by your existing company!, and i've used this site too,for quotes,

thanks again!

dpd.

Hi

This is a very good argument and one that we ask ourselves quite regularly, you would think in an ideal world that your insurance would go down each year with your existing insurer but unfortunately this isn't the case as what will happen is you will be attracted in with introductory discounts, non of which you'll get the following year hence the increase.

My advice to anyone who has insurance due would be to shop around before taking the renewal notification from your existing insurer, you can get a quote with ourselves in as little as 5 minutes, which may save you £100s over 12 months.

Good luck
Peter

pete, i have been driving now for over 25 years, with a good driving record, of little or no accidents,or claims,during this period, but im constantly annoyed,that however long you stay with your present insurer  givern this,there yearly re-newal costs are not as compettive,as shopping around!, why don't they reward good drivers with reduced premiums,and make the bad drivers,or unisured,more liable?, even more so,if your car is quite old,as my existing one,is nearly 10 years old now, why is this?