By Chris Schulz
Investigative Journalist | Kaipūrongo Whakatewhatewha
While checking my bank account recently, a transaction stood out: a payment of $94.53.
It seemed like a lot of money. In this day and age, it is a lot of money.
We had dutifully paid that money every 2 weeks for 4 years to insure a 2021 Mitsubishi Outlander.
That's $47.27 each week, or $2,458 a year. In total, we’d paid nearly $10,000 to insure just one of our family cars.
With the rising cost of living, and as the price of power, groceries and other everyday essentials keeps going up, that car insurance outlay suddenly seemed too high.
Could I save money without losing coverage?
It was time to find out.
Give us a deal, please!
I jumped on Google and began surveying the options.
Canvassing car insurance companies for quotes is time consuming. They request personal details, claim histories, car makes and models, and other identifying factors before presenting a figure to you.
But it can be worth it. After surveying several options, some of the quotes offered a discount of up to 30% on what I was paying.
Cove Insurance, the cheapest car insurer for 23-year-olds in Consumer’s recent survey of nine car insurers, suggested our insurance could be as low as $33 a week, a saving of 30%.
It was time to ask State Insurance why I was paying so much.
State looks into it
I called State Insurance’s 0800 number, sat on hold and waited for an operator to answer the phone.
I explained the situation and that I was considering switching to a different insurance company to save money.
I asked if they could offer a better deal.
The operator told me he'd need to check with his supervisor and call me back. He told me this could take up to 2 days.
Actually, it was later that afternoon I received a call back confirming it would be possible to give me a better deal on my car insurance.
The catch? I’d need to be set up on State's "new system" – meaning I'd need to spend 20 minutes answering questions to fill out an entirely new insurance policy.
This was painful – but worth it.
How much we saved
By the time I had given the operator all my details, the $94.53 fortnightly payment had dropped to $63.39. That’s $31.70 a week, or $1,648 a year – a discount of 33%.
That’s even more than the discount offered by the cheapest competitor I could find.
In a statement, a State spokesperson said it transitioned to a “new technology platform” last year. This “enabled us to simplify our products to better reflect an individual’s risk”.
Premiums were based on several factors, including “where you live, your sum insured, the type of assets you insure and past claims,” the spokesperson said.
Consumer NZ investigative writer Vanessa Pratley has researched car insurance and says it’s always worth comparing different insurance policies to see if you’re on the correct plan.
“Take the time to compare what's on offer and consider whether switching plans or providers would get you back to a policy you can afford,” she says.
Car insurance is going up, up and up
Car insurance has increased by 46% for some customers over the past 2 years, a recent Consumer survey found.
Inflation and extreme weather events are factors driving up insurance costs, but other contributing factors may be age and life stage.
Pratley advises car owners to shop around to find the best deals.
“If the cost to insure your car is stressing you out right now, don’t cancel your cover or drop down to third-party – shop around and see what savings you could make first,” she advises.
"You can switch insurance providers any time (though there might be cancellation fees), and that could potentially reward you with hundreds of dollars in annual savings.”
For more:
Compare car insurance rates with our Consumer NZ guide.
Trying to save money? Here are Consumer's tips.
Need to make a claim? Find out how.
Paying too much for car insurance?
Our latest survey results found you could save hundreds of dollars a year by shopping around.
