Insurance premiums do not differ hugely by paying higher excess

A study by Which? revealed that by choosing to pay a higher excess on an insurance policy made very little difference to the cost of the premium .

Aviva were highlighted in the study where by paying an excess of £200 for a car insurance quote for a 45 year old Londoner insuring a £2000 Honda Jazz, the premium rose by only £34.

Some opt for an increase in the voluntary excess as a way of reducing premiums especially if the individual doesn’t have a strong no-claims record. However after this study Which? said that it is not a forgone conclusion that a higher excess means a cheaper premium.

Peter Vicary-Smith, chief executive of Which?, said, “Common sense would suggest that if you increase your excess, you’d pay less for your policy, but we were surprised to find that some policies actually ended up costing more.

“We regularly find that some of the big name insurers are found wanting when it comes to offering people good customer service but now it seems they’re also falling short on value for money.”

Aviva commented that an increase in the excess should result in a cheaper premium. It appeared to them that as the quote was based on a fictitious person the figures had been massaged to find a cheaper premium. This follows the same pattern fraudsters’ use.

A spokesman said, “We detected this and hence increased the premium. We owe it to our customers to do all we can to detect and discourage fraud .”

A spokesperson for the Association of British Insurers said, “Opting for a higher excess can sometimes reduce the premium. But it may not make a difference if other risk factors involved, such as poor claims history of the driver, where a higher excess may not significantly reduce the potential risk to the insurer .”

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